Question

a. what are the determinants of demand?
instructions: click the box with a check mark for correct or click a second time to clear the box for incorrect.

• income
• price of related goods
• a good’s own price
• technology
• tastes and preferences
• resource prices
• number of consumers

b. given the following diagram, indicate whether a change in the value of each of the following determinants of demand leads to a movement along the demand curve or a shift in the demand curve.
i. change in market price: (click to select)
ii. change in income: (click to select)
iii. change in consumer expectations: (click to select)
iv. change in the price of a related good: (click to select)
v. change in the price of an unrelated good: (click to select)
vi. change in preferences for this good: (click to select)
demand curve diagram with price on y - axis and quantity on x - axis, showing curves d and d

Explanation:

For part a: Determinants of demand are factors that affect the quantity of a good consumers want to buy, excluding supply-side factors. Income, price of related goods, tastes and preferences, and number of consumers shift demand. A good's own price causes movement along the curve, while technology and resource prices are supply determinants.
For part b: A change in a good's own price causes movement along the demand curve. Changes in non-price determinants (income, expectations, related goods prices, preferences) shift the demand curve. Unrelated goods do not affect the demand curve.

Answer:

a. Correct determinants (to check):

• Income
• Price of related goods
• Tastes and preferences
• Number of consumers

b.
i. Change in market price: Movement along the demand curve
ii. Change in income: Shift in the demand curve
iii. Change in consumer expectations: Shift in the demand curve
iv. Change in the price of a related good: Shift in the demand curve
v. Change in the price of an unrelated good: No change to the demand curve
vi. Change in preferences for this good: Shift in the demand curve