1. Change in Demand

2. Change in the Quantity Demanded
When only the price changes and all else remains constant, there is a change in the quantity demanded
A change in quantity demanded is a movement along the original demand curve

3. Change in the Quantity Demanded

4. Change in Demand
There are several factors that can cause the demand curve to shift
These are all factors other than price that result in an entirely new demand curve

5. Change in Demand

6. Change in Demand Consumer income Consumer Tastes
Prices of related goods
Substitutes
Complements
Expectations
Number of Consumers

7. Change in Demand
All factors that change demand and result in a new demand curve can increase or decrease demand
When demand increases the curve shifts right
When demand decreases the curve shifts left
The demand curve never shifts up or down

8. Change in Demand

9. Demand Elasticity
Demand Elasticity is the extent to which a change in price causes a change in the demand for a product
Elastic Demand – change in price creates a large change in demand
Inelastic Demand – change in price does not affect demand in a significant way

10. Demand Elasticity Can the purchase be delayed?
If the purchase can be delayed the product is generally elastic
Are adequate substitutes available?
When substitutes are available the product is generally elastic
Does the purchase use a large portion of income?
When larger purchases are concerned, products are very elastic