Check Your Understanding

1. Question

   Explain whether each of the following events represents (i) a change in demand (a shift of the demand curve) or (ii) a movement along the demand curve (a change in the quantity demanded).

   1. A store owner finds that customers are willing to pay more for umbrellas on rainy days.

   2. When XYZ Telecom, a long-distance telephone service provider, offered reduced rates on weekends, its volume of weekend calling increased sharply.

   3. People buy more long-stem roses the week of Valentine’s Day, even though the prices are higher than at other times during the year.

   4. A sharp rise in the price of gasoline leads many commuters to join carpools in order to reduce their gasoline purchases.