Demand
Short
Answer Type Questions Question 1. Explain diagrammatically the
movement along a demand curve and shift in demand curve.
Answer: Movement along a demand curve is of two types: (i)
Extension of Demand : Extension of demand is shown by the table given below and
curves. When the price of chocolate is ₹ 5, one chocolate is demanded. When
price reduces to ₹ 1, demand extends to 5 chocolates. Price (in ₹) Quantity (Units) Description 5 1 Fall in price 1 5 Rise in quantity demanded Extension
of demand is indicated by a movement along the same demand curve, as from point
A to B on the demand curve-D. (ii)
Contraction of Demand: Contraction of demand is shown with the help of table and given
below curve, when the price of chocolate is ₹ 1 per chocolate, demand is for 5
chocolates; when price rises from ₹ 1 to ₹ 5 per unit, demand contracts to 1
chocolate only. Price (in₹) Quantity (Units) Description 1 5
