If a product becomes more popular a) Which curve will shift? b) Along which curve will price and quantity move? c) At a new equilibrium, will price be higher or lower? d) At a new equilibrium, will quantity be higher or lower?

The most obvious determinant of demand is the buyers' taste. If you like a product, or a product is healthy or a product is popular, you buy more of it.

a) When buyers buy more of the product, the demand curve will shift. There will be a shift to the right, since the quantity demanded for the product will increase at every price.

b) At the previous market price, there is now excess demand for the product, since people buy more of it at every price. The increase in demand will raise the market price and equilibrium quantity. When price rises, producers supply more of the product, even though the supply curve does not shift. Thus, there will be a movement along the supply curve to the new price and quantity. The reason is simple. If the price of the product changes, there is a movement along the fixed supply or demand curve. If there is a change in one of the non-price determinants of demand or supply such as tastes or number of sellers, the demand curve or the supply curve shifts. A change in taste shifts the demand curve. Due to the shift of the demand curve, price changes. Since the price changes there is a movement along the supply curve.

c) The increase in demand raises the equilibrium price. At new equilibrium, the price will be higher.

d) The increase in demand increases both the price and equilibrium quantity.