Question

State one reason for a rightward shift in demand curve.

Hint:

Remember: A change in the price of the good causes movement \textit{along} the curve, but a change in other factors causes a \textit{shift} of the curve.

Answer 1

Step 1: Concept Explanation:
A shift in the demand curve occurs due to factors other than the price of the good itself. A rightward shift signifies an increase in demand, meaning that more of the good is demanded at each price level.
Step 2: Key Influencing Factors:
The shift can be influenced by changes in consumer income, preferences, the prices of related goods (substitutes or complements), or expectations about the future.
Step 3: Identifying a Key Reason:
A primary cause for a rightward shift is an increase in consumer income, particularly for normal goods. When consumers have more money, they are more willing and able to purchase more of a product, even if its price remains constant.
Step 4: Conclusion:
An increase in consumer income (for normal goods) is a significant factor leading to a rightward shift in the demand curve.