Movements Versus Shifts
The demand curve is a two-dimensional depiction of the relationship between price and quantity demanded. Movements along the curve occur only if there is a change in quantity demanded caused by a change in the good's own price. A shift in the demand curve, referred to as a change in demand, occurs only if a non-price determinant of demand changes. For example, if the price of a complement were to increase, the demand curve would shift leftward reflecting a decrease in demand. Conversely, a rightward shift in the demand curve reflects an increase in demand. The shifted demand curve represents a new demand equation.
Movement along a demand curve due to a change in the good's price results in a change in the quantity demanded, not a change in demand. A change in demand refers to a shift in the position of the demand curve in two-dimensional space resulting from a change in one of the other arguments of the demand function.
Read more about this topic: Demand (economics)
Famous quotes containing the words movements and/or shifts:
“Who among us has not, in moments of ambition, dreamt of the miracle of a form of poetic prose, musical but without rhythm and rhyme, both supple and staccato enough to adapt itself to the lyrical movements of our souls, the undulating movements of our reveries, and the convulsive movements of our consciences? This obsessive ideal springs above all from frequent contact with enormous cities, from the junction of their innumerable connections.”
—Charles Baudelaire (1821–1867)
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—Helen Hayes (1900–1993)