Question

Which of the following causes a rightward shift in the demand curve of a normal good?

• A. Fall in consumer income
• B. Rise in price of substitute good
• C. Rise in price of complementary good
• D. Increase in production cost

Hint:

Price of Substitute \(\uparrow\) \(\Rightarrow\) Demand for given good \(\uparrow\)

Answer 1

The Correct Option is B

Concept: Demand curve shifts due to changes in determinants other than the commodity’s own price.

Step 1: Understanding substitute goods.
Substitute goods can replace each other, such as tea and coffee.

Step 2: Effect of rise in substitute price.
If the price of substitute good rises:

• Consumers switch to the given good.
• Demand for the given good increases.
• Demand curve shifts rightward.

Step 3: Evaluating options.
(A) Fall in income reduces demand for normal goods.
(B) Correct because substitute becomes expensive.
(C) Complement price rise decreases demand.
(D) Production cost affects supply, not demand.

Step 4: Final conclusion.
Hence: \[ \boxed{\text{(B) Rise in price of substitute good}} \]