Skip to content

CSEET · Economic and Business Environment · Basics of Demand and Supply and Forms of Market Competition

Which one of the following changes would cause a movement along the existing demand curve for packaged milk, rather than a shift of the curve?

A rise in the price of packaged milk itself causes a movement along the existing demand curve, specifically a contraction of demand. Changes in income, tastes or prices of related goods are other determinants and shift the whole curve rather than moving along it.

  1. AA rise in the price of packaged milk itselfCorrect
  2. BA rise in consumers' incomes
  3. CA widespread change in preference towards plant-based milk
  4. DA rise in the price of tea, a complement

Explanation

Only a change in the good's own price moves buyers along the same demand curve, producing extension or contraction. Income, tastes and prices of related goods are determinants that shift the whole curve, so the other options cause shifts.

Did you get it right without looking?

One question tells you little. A timed set on Basics of Demand and Supply and Forms of Market Competition shows your real accuracy, how long you take and where you lose marks.

Practise Basics of Demand and Supply and Forms of Market CompetitionFree diagnostic mock

More Basics of Demand and Supply and Forms of Market Competition questions