Shifts and Movements Along the Demand Curve Decide whether the following examples indicate a shift of the demand curve or a movement along the demand curve. Mark the correct column. Example Movement along the demand curve A shift in the demand curve 1. Mammoth Mountain hikes the price for ski tickets and sales plummet. 2. Lack of snow keeps the skiers away. 3. An increase in the excise tax on cigarettes causes younger smokers to quit. 4. Cutting cigarette ads from TV causes cigarette smoking among teens to fall. 5. Nike sales fall as Skechers shoes gain popularity. 6. Teens have had it with the high price of Nike Air Jordans. 7. Mortgage rates are at an all-time low, and new home loan applications soar. 8. A booming economy spurs home sales.
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- A movement along the demand curve occurs when there is a change in the quantity demanded due to a change in the price of the good or service. - A shift in the demand curve occurs when a factor other than the price of the good or service changes, leading to an Show more…
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A change in quantity demanded (or a movement along the demand curve) is caused by a change in its own price, while a change in demand (or a shift of the demand curve) is caused by a change in non-price determinants that include changes in consumers' income, taste or preference, price of other goods, expected future price, etc. If Coke's price increases, what will happen to the demand or quantity demanded for Pepsi, all other things being equal? Explain whether it is a movement along the demand curve or a shift of the demand curve. If Coca-Cola develops new technology that makes Coke tastier, what will happen to the supply curve and demand curve for Coke? Is the demand (curve or schedule) for Coke or Pepsi seasonally different? What is the relationship between Coke and Pepsi? Do they have the same demand curve or are they different?
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Shifts in Supply or Demand II The following graph shows the market for hot dogs in Detroit, where there are over 1,000 hot dog stands at any given moment. Suppose the price of sausage casing, a major ingredient in hot dogs, suddenly increases. Show the effect of this change on the market for hot dogs by shifting one or both of the curves on the following graph, holding all else constant. Note: Select and drag one or both of the curves to the desired position. Curves will snap into position, so if you try to move a curve and it snaps back to its original position, just drag it a little farther. Supply Demand QUANTITY (Hot dogs)
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