Graphing Demand

Use the chart below to determine the best answer to the given scenario. Consider the item in parenthesis.  If you have trouble, review the ‘Graphing Demand” screencast in Lesson 3.03.

This is a demand curve showing shifts in demand. D1 is the original demand line. It contains two points - A, which represents a higher price and lower demand and B, which represents lower price and higher demand. Line D2 shows an increase in demand- in other words, a higher quantity demanded for a given price. This line is above D1. Line D3 represents a decrease in demand, or a lower quantity demanded for a given price. It is below line D1.

  • A to B
  • B to A
  • D1 to D2
  • D1 to D3
  • No Change

  1. A nation is experiencing a severe drought, with no sign of relief in the near future. What will happened to the demand curve for umbrellas? Does
    a. the quantity demanded decrease
    b. the quantity demanded increase
    c. the demand curve shift to the right, indicating an increase in demand
    d. the demand curve shift to the left, indicating a decrease in demand
    Answer: d. the demand curve shifts to the left, indicating a decrease in demand

  2. To help sell umbrellas stores offer a 50% discount. (Umbrellas)
    What will happened to the demand curve for umbrellas? Does
    a. the quantity demanded decrease
    b. the quantity demanded increase
    c. the demand curve shift to the right, indicating an increase in demand
    d. the demand curve shift to the left, indicating a decrease in demand
    Answer: a. the quantity demanded decrease

  3. The cost of producing umbrellas increase. (Umbrellas)
    What will happened to the demand curve for umbrellas? Does
    a. the quantity demanded decrease
    b. the quantity demanded increase
    c. the demand curve shift to the right, indicating an increase in demand
    d. the demand curve shift to the left, indicating a decrease in demand
    Answer: b. the quantity demanded increase

  4. The price of Xbox game consoles is reduced 50%. (Xbox games)
    What will happened to the demand curve for umbrellas? Does
    a. the quantity demanded decrease
    b. the quantity demanded increase
    c. the demand curve shift to the right, indicating an increase in demand
    d. the demand curve shift to the left, indicating a decrease in demand
    Answer: a. the quantity demanded decrease

  5. The price of Xbox game consoles is reduced 50%. (Play Station game consoles)
    What will happened to the demand curve for umbrellas? Does
    a. the quantity demanded decrease
    b. the quantity demanded increase
    c. the demand curve shift to the right, indicating an increase in demand
    d. the demand curve shift to the left, indicating a decrease in demand
    Answer: d. the demand curve shift to the leftt, indicating a decrease in demand

  6. Congress passes a law that everyone has to be paid more. (Inferior Goods)
    What will happened to the demand curve for umbrellas? Does
    a. the quantity demanded decrease
    b. the quantity demanded increase
    c. the demand curve shift to the right, indicating an increase in demand
    d. the demand curve shift to the left, indicating a decrease in demand
    Answer: d. the demand curve shift to the left, indicating a decrease in demand

  7. Congress passes a law that everyone has to be paid more. (Normal  Goods)
    What will happened to the demand curve for umbrellas? Does
    a. the quantity demanded decrease
    b. the quantity demanded increase
    c. the demand curve shift to the right, indicating an increase in demand
    d. the demand curve shift to the left, indicating a decrease in demand
    Answer: c. the demand curve shift to the right, indicating an increase in demand

  8. The price of gasoline decreases.  (Gasoline)
    What will happened to the demand curve for umbrellas? Does
    a. the quantity demanded decrease
    b. the quantity demanded increase
    c. the demand curve shift to the right, indicating an increase in demand
    d. the demand curve shift to the left, indicating a decrease in demand
    e. no change
    Answer: e. no change

  9. The price of gasoline increases dramatically. (Sport Utility Vehicles (SUV))
    What will happened to the demand curve for umbrellas? Does
    a. the quantity demanded decrease
    b. the quantity demanded increase
    c. the demand curve shift to the right, indicating an increase in demand
    d. the demand curve shift to the left, indicating a decrease in demand
    Answer: d. the demand curve shift to the left, indicating a decrease in demand

  10. General Motors offers a mail in rebate for all new car purchases. (New GM Cars)
    What will happened to the demand curve for umbrellas? Does
    a. the quantity demanded decrease
    b. the quantity demanded increase
    c. the demand curve shift to the right, indicating an increase in demand
    d. the demand curve shift to the left, indicating a decrease in demand
    Answer: c. the demand curve shift to the right, indicating an increase in demand

ANSWERS
1. D
2. A
3. B
4. A
5. D
6. D
7. C
8. E
9. D
10. C