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A Level Economics (9708)•9708/12/M/J/19
Question 10 from 9708/12/M/J/19

Explanation

Demand Curve Shifts vs. Movements Steps:

  • Recall that the demand curve shows quantity demanded at different prices; shifts occur due to non-price determinants like income or related goods' prices.
  • A movement along the curve happens when only the good's own price changes.
  • Without the diagram, D1's direction (left or right) is unknown, making it impossible to identify the exact cause.
  • Options A–C affect non-price factors (substitutes, advertising, income), potentially shifting demand; D affects price, causing movement.

Why D is incorrect:

  • A decrease in good G's price causes a movement down along the existing demand curve, not a shift to a new curve like D1 (law of demand).

Why the others are wrong:

  • A: Could shift demand left if D1 is leftward, but direction unknown.
  • B: Reduces demand, potentially left shift, but depends on D1.
  • C: Increases demand for normal good, potentially right shift, but depends on D1.

Not enough information. Final answer: Not enough information.

Topic: Demand and supply curves

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