Movement along the demand curve

• Movement

  A normal demand curve slopes downwards from the left to right. It has a negative slope i.e when price increases demand decreases and vice versa
• Movement is caused ONLY by changes in prices and not any other factor affecting demand.
• Increase in price , decrease in qty dd

  • Decrease in quantity due to increase in price is known as contraction. ( movement from point a to b)
  • Price increases from P0 to P1
  • Quantity demanded decreases from Q0 to Q1

  
• Decrease in price, increase in qty dd

  • Increase in quantity demanded due decrease in price is known as expansion/extension. ( movement from point a to c)
  • Price reduces from P0 to P2
  • Quantity demanded increases from Q0 to Q2