Demand and Supply
PX on the QX are shown
Change in demand
A change in demand is a "shift" or movement of the demand function.
A shift of the demand function can be caused by a change in:
· incomes
· the prices of related goods
· preferences
· the number of buyers.
If incomes or preferences change, the demand function [relationship between P and
Q] will change. These are sometimes called "demand shifters"
Be sure to understand difference between a "change in demand" and a "change in
quantity demanded"
change in demand --- shift of the function
change in quantity demanded --- move on the function
Inferior, Normal and Superior Goods
A change in income will usually shift the demand function. When a good is a
"normal" good, there is a positive relationship between the change in income and
change in demand:
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