CHANGE IN QUANTITY DEMANDED AND CHANGE IN DEMAND
Demand changes to due to change in the price of the
commodity, price of the other commodities (price of substitute and
complementary), income of the consumer
Change in quantity demanded
- ·
Its change in the quantity demanded due to
change in the price of the commodity alone, other factors remain the same.
- ·
Its movement along the same demand curve
- ·
It can be expansion and contraction
Change in demand
- ·
It is change in the quantity demanded due to
change in the other factors rather than price of the commodity – like change in
the income of the consumer, price of the other commodities etc.
- ·
It is shift in the demand curve
- ·
It can be increase in demand and decrease in
demand
Expansion and
contraction in demand
- ·
Occurs due to change in the price only
- ·
Both can be shown in the same demand curve
·
Expansion
in demand – it is an increase in the quantity demanded of a commodity due
to a fall in the price of the commodity only. It can be represented in the same
demand curve.
·
Opposite is the case of contraction.
Increase and
decrease in demand
- ·
Happens due to the change in the other factors
like price of other commodities, income of the consumers etc, rather the price
- ·
Demand curves shifts.
·
Increase in
demand – it is an increase in the quantity demand due to change in the
other factors like price of other commodities, income of the consumers etc
rather the price
o
Eg. Income of the consumer increases, fall in
the price of complementary goods, an increase in the price of substitute goods.
o
Simple example, the petroleum price remain the
same but the demand for the petroleum increases – the reasons may be the fall
in the price of the car(complementary good), or increase in the price of diesel
(can be substitute )
·
Here the demand curve shifts to upward or
rightward
·
Decrease in the demand is the opposite of this
