Explain why a demand curve will shift. Explain why a supply curve will shift. What are the differences between quantity demanded and demand? Provide examples from your personal or professional life where you believe a demand curve shifted and when you believed a supply curve shifted.
The term shift in demand is used to describe a situation when a different (increased or decreased) quantity is demanded at every price because of some change in any economic factor other than price (Greenlaw & Shapiro, 2018). These factors include changes in the size and age of the population, tastes, expectations, income, etc. Accordingly, the demand curve will show some changes. For example, if there is a baby boom which causes a huge number of young population later, the demand for kids’ products and toys will grow.
The demand and the quantity demanded are not the same. If we look at the demand curve, we can easily see that the quantity demanded is only a specific point on this curve, while the demand refers to the curve itself.
The term shift in supply is used to describe a situation when a different quantity is supplied at every price (Greenlaw & Shapiro, 2018). There are several factors that can cause such a shift, they include natural conditions, government regulations, input prices, etc. According to Kenton (2022), technological changes are recently the main reason for supply curve shifts. For example, the supply curve will shift to the right, if due to some inventions a company starts using new technology to reduce production costs. Or this curve can shift to the left if climate change (e.g., droughts) reduces the supply of farm products.
The example of a demand curve shifted in my personal life will probably be too common. During our last COVID-19 lockdown, the demand for daily and food products raised and people were ready to pay more just because it became impossible to go outside for shopping. At the same time, unfortunately, the supply for these products decreased because the city was locked, and many sellers could not restock.
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References
Greenlaw, S. A. & Shapiro, D. (2018). Principles of microeconomics, 2e. Open Stax Rice University. Retrieved from https://d3bxy9euw4e147.cloudfront.net/oscms-prodcms/media/documents/Microeconomics2e-OP.pdf
Kenton, W. (May 30, 2022). Supply Curve. Retrieved from https://www.investopedia.com/terms/s/supply-curve.asp