Macroeconomics › Section C · Demand and supply › Topic C.2
Shifts in demand and supply
Prices change because curves move. Income shifts, rival prices, tastes, costs and technology all shove the demand or supply curve to a new position - and the market then finds a new equilibrium. This topic is the catalogue of what moves which curve, and in which direction.
In this topic
- Movement versus shift, once more
- What shifts demand
- Income: normal and inferior goods
- Related goods: substitutes and complements
- What shifts supply
- Worked example: a demand shift in the honey market
- Worked example: a supply shift in the same market
- The four patterns
- When both curves shift
- Common mistakes to avoid
- Key takeaways
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