Shifts In The Demand Curve

What are the Shifts in the Demand Curve?

This concept was derived under the presumption that the customer’s earnings, the costs of other commodities, and the proclivities of the customer are given. Given the costs of other commodities and the proclivities of a customer, if the earning rises, then the demand for the commodity at each cost price changes. Hence, there is a shift in the demand curve.

For normal commodities, the demand curve moves towards the right and for inferior goods, the demand curve moves towards the left. Given the customer’s earning and his or her proclivities, if the cost of a corresponding commodity differs, then the demand for a commodity at each degree of its cost differs and there is a shift in the demand curve. If there is a rise in the price of an alternative commodity, then the demand curve moves towards the right.

On the other hand, if there is a rise in the cost of a supplementary commodity, then the demand curve moves towards the left. The demand curve can also move due to a difference in the preferences and proclivities of the customer.

If the customer’s proclivities differ in the obligation of a commodity, then the demand curve for such a commodity shifts towards the right. On the other hand, the demand curve moves towards the left due to an adverse difference in the preferences of the consumer.

The demand curve for cold drinks, for instance, is likely to shift towards the right in the summer because the preference for cold drinks increases in summer. The disclosure of the fact that cold drinks might be injurious to health can adversely affect proclivities for cold drinks. This is likely to result in a leftward demand curve shift for cold drinks.

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