This graph shows the quantity of t-shirts demanded at D and D1. The change in quantity demanded caused by a change in the price of t-shirts is shown as O a shift to the right of the demand curve. O a shift to the left of the demand curve. O movement along the demand curve.

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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### Understanding Demand Curve Changes

#### Graph Explanation:
The provided graph demonstrates the relationship between the quantity of t-shirts demanded at different points, labeled D and D₁. 

#### Concept Overview:
In economics, the demand curve illustrates how the quantity demanded of a good changes with its price. The primary focus here is on how changes in the price of t-shirts affect quantity demanded.

#### Key Points to Note:
1. **Shift to the Right of the Demand Curve:** This situation represents an increase in demand. It usually occurs due to factors other than a change in the price of the good, such as an increase in consumer income, changes in tastes and preferences, or prices of complementary goods.

2. **Shift to the Left of the Demand Curve:** This denotes a decrease in demand. Factors leading to this situation include a decrease in consumer income, change in tastes and preferences against the good, or an increase in the prices of complementary goods.

3. **Movement Along the Demand Curve:** This is the change in quantity demanded due to a change in the price of the good itself. It’s crucial to distinguish between a movement **along** the demand curve and a **shift** of the demand curve, as the former is caused only by price changes, while the latter can be triggered by other factors.

#### Quiz Question:
The change in quantity demanded caused by a change in the price of t-shirts is shown as:
- ( ) a shift to the right of the demand curve.
- ( ) a shift to the left of the demand curve.
- ( ) movement along the demand curve.

**Correct Answer:**
- ( ) movement along the demand curve.

Understanding these concepts is vital for interpreting demand changes effectively in various economic scenarios.
Transcribed Image Text:### Understanding Demand Curve Changes #### Graph Explanation: The provided graph demonstrates the relationship between the quantity of t-shirts demanded at different points, labeled D and D₁. #### Concept Overview: In economics, the demand curve illustrates how the quantity demanded of a good changes with its price. The primary focus here is on how changes in the price of t-shirts affect quantity demanded. #### Key Points to Note: 1. **Shift to the Right of the Demand Curve:** This situation represents an increase in demand. It usually occurs due to factors other than a change in the price of the good, such as an increase in consumer income, changes in tastes and preferences, or prices of complementary goods. 2. **Shift to the Left of the Demand Curve:** This denotes a decrease in demand. Factors leading to this situation include a decrease in consumer income, change in tastes and preferences against the good, or an increase in the prices of complementary goods. 3. **Movement Along the Demand Curve:** This is the change in quantity demanded due to a change in the price of the good itself. It’s crucial to distinguish between a movement **along** the demand curve and a **shift** of the demand curve, as the former is caused only by price changes, while the latter can be triggered by other factors. #### Quiz Question: The change in quantity demanded caused by a change in the price of t-shirts is shown as: - ( ) a shift to the right of the demand curve. - ( ) a shift to the left of the demand curve. - ( ) movement along the demand curve. **Correct Answer:** - ( ) movement along the demand curve. Understanding these concepts is vital for interpreting demand changes effectively in various economic scenarios.
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