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BUS 1103 Discussion Forum Unit 2

1. A demand curve shifts when determinants other than price change, such as expectations of future prices, income levels, or the number of potential buyers. This causes the entire demand curve to shift left or right. 2. A supply curve shifts when factors that affect production or the number of sellers change, such as technology, expectations of future prices, input prices, or the number of sellers. This causes the supply curve to shift left or right. 3. Demand refers to consumer desire at various price points, while quantity demanded is the exact amount purchased at a given price. A change in demand shifts the curve, while a change in quantity demanded moves along the curve due to price changes.

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216 views

BUS 1103 Discussion Forum Unit 2

1. A demand curve shifts when determinants other than price change, such as expectations of future prices, income levels, or the number of potential buyers. This causes the entire demand curve to shift left or right. 2. A supply curve shifts when factors that affect production or the number of sellers change, such as technology, expectations of future prices, input prices, or the number of sellers. This causes the supply curve to shift left or right. 3. Demand refers to consumer desire at various price points, while quantity demanded is the exact amount purchased at a given price. A change in demand shifts the curve, while a change in quantity demanded moves along the curve due to price changes.

Uploaded by

Julius Owuonda
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© © All Rights Reserved
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1. Why a demand curve will shift.

A shift in demand curve is when other determinants of demand (except

price) changes, causing a shift in the entire demand curve (Amadeo, 2020). 

Those determinants may include:

i. Expectations of future price changes: When consumers expect prices of

particular product to increase, they may buy more of it now, even though the

price have not yet changed, thereby shifting the demand curve to the right.

ii. Change of income of the consumers: If you get a pay raise, you are more likely

to buy more of a certain product, even if their prices remain constant, thereby

shifting the demand curves to the right.

iii. The number of potential buyers: This affects the aggregate demand in that

when there is a flood of new consumers in the market, they will buy more

products at the same price, thus shifting the demand curve to the right.

Why a supply curve will shift. 

A shift in supply curve is when there is an alteration in the production, output, or

rather, supply (Investopedia Staff, 2021). Several factors may cause a shift in supply curve.

This may be due to:

i. Change in number of sellers. The higher the number of sellers, the higher the

supply, there causing the supply curve to shift to the right.


ii. Technology- Adopting modern technology that increases efficiency in production

may shift the supply curve to the right.

iii. Expectation of future price increase- When sellers expect prices to increase,

they may reduce the quantity supplied so that they can supplier more when

prices are higher, resulting in a shift in supplier curve to the left.

iv. Prices of relevant inputs- if the cost of production increase, sellers will be less

inclined to supply the same quantity at a given prices, thereby shifting the

supply curve to the left.

Differences between quantities demanded and demand

i. Demand refers to consumer’s desire and ability to buy goods and services at

various prices in any given period, ceteris paribus, while quantity demanded is

the exact quantity of goods or services that is demanded by consumers at any

particular price.

ii. Change in demand is reflected by increase or decrease in demand and is caused

by factors other than prices (such as income and substitutes), leading to a shift

in the demand curve. In contrast, a change in quantity demanded is reflected

by a contraction or expansion of demand, and is caused by change in price

leading to the movement along the demand curve.

Examples from my personal or professional life where I believe a:

Demand curve shifted


When I got a better paying job this year, my demand for the drinking juice increased

despite the price remaining constant. Before, I used to buy two liters of apple juice a

week. However, with the increased income, I started buying five liters, meaning that

my demand for apple juice shifted to the right due to increased income

Supply curve shifted. 

Right after my highschool, I used to help my mother make and sell peanut butter.

When we bought a modern large scale machine, we were able to process more, hence

the quantity supplied greatly increased leading to the shifting of supply curve from left

to right.

REFERENCES

Amadeo, K. (2020, August 20). When demand changes but price remains the price.

Retrieved April 18, 2021, from https://www.thebalance.com/shift-in-demand-

curve-when-price-doesn-t-matter-3305720

Investopedia Staff. (2021, March 4). Scarcity. Retrieved April 16, 2021, from

Investopedia.com website: https://www.investopedia.com/terms/s/scarcity.asp

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