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Homework answers / question archive / Changes in which of the following do ??? cause the demand curve to shift? A) the price of a complement good
Changes in which of the following do ??? cause the demand curve to shift?
A) the price of a complement good.
B) the price of the good.
C) the price of a substitute good.
D) buyers' incomes.
b) The price of the good is the right answer. A consumer moves along the demand curve as a result of a change in the price of the good.
The other are not correct because
a) price of a complement good causes demand curve to shift, e.g., a consumer will demand more of the good if a complement becomes cheaper and it is shown by a rightward shift in demand curve
c) price of a substitute good causes demand curve to shift, e.g., a consumer will demand more of the good if a substiture becomes more expensive and it is shown by a rightward shift in demand curve
d) demand curve shift rightwards if a buyer's income increases (this is of course true for a normal good)