CHANGE IN QUANTITY DEMANDED VS CHANGE IN DEMAND

Change in the own price of a commodity on one hand and changes in any of the other demand factors such as prices of related goods, consumers’ income tastes/preferences, expectations of future prices and incomes, consumer population, etc., have two different effects on the demand for a commodity.

Changes in Quantity Demanded (movement along demand curve)
The change in quantity demanded be it increase or decrease is as a result of price alone. That is, price is a major factor here for the changes in quantity demanded. It is also referred to as movement along demand curve. 
There are two types of changes in quantity demanded: 

• an increase in quantity demanded (downward movement along the same demand curve) 
• and a decrease in quantity demanded (upward movement along the same demand curve)

 Increase in Quantity Demanded 
 It is caused when the price of a commodity reduces. It is shown as a downward movement along the same demand curve from left to right

  From the graph above there is a movement along the demand curve from A to B indicating an increase in quantity demanded as price reduces. At point A, when the price was N5000 quantity bought was 40 bags. But when the price reduced to N4,000, quantity bought increased to 60 bags.

Decrease in Quantity Demanded
It is caused when the price of a commodity increase. It is shown as an upward movement along the demand curve from right to left.

From the graph above there is a movement (upward) along the demand curve from point A to point B indicating a decrease in quantity demanded as price increases. At point A when price was N3,000, quantity bough was 80 bags. But when price increased to N4000, quantity bought decreased to 60 bags.

Change in Demand (shift in Demand Curve)
Change in demand be it increase or decrease is as a result of other factors affecting demand (price of related commodity, income, Consumer preference), where price is held constant. It is also referred to as a shift in the demand curve

there are two types of Change in Demand:

• Increase in Demand (rightward shift in demand curve)
• Decrease in Demand (Leftward Shift  in demand curve)

Increase in Demand (rightward shift in demand curve)  
 An increase in demand is caused where more quantity of commodities are bought as a result of change in other factors affecting demand where price is held constant.

 From the graph above there is an increase in demand from 40 bags to 80 bags. but the price still remained N4500. This change is as a result of change in other factors affecting demand. It is a rightward shift in the demand curve from D0 to D1.

 Decrease in Demand (Leftward shift in Demand Curve) 
A decrease in demand is caused when less quantity of commodities are bought as a result of changes in other factors affecting demand where price is held constant.

 From the graph above there is a decrease in the supply from 80 bags to 40 bags. But the price still remained at N5,000. This change is as a result of changes in other factors affecting demand. it is a leftward shift in the demand curve from D1 to D2.

Note:  A change in quantity demanded is caused by change in price, while a change in demand is caused by changed in other factors affecting demand.

Article by: Monday Desmond