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).
A store owner finds that customers are willing to pay more for umbrellas on rainy days.
The quantity of umbrellas demanded is higher at any given price on a rainy day than on a dry day. This is a rightward shift of the demand curve.
When XYZ Telecom, a long-distance telephone service provider, offered reduced rates on weekends, its volume of weekend calling increased sharply.
The quantity of weekend calls demanded rises in response to a price reduction. This is a movement along the demand curve for weekend calls
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.
The demand for roses increases the week of Valentine’s Day. This is a rightward shift of the demand curve.
A sharp rise in the price of gasoline leads many commuters to join carpools in order to reduce their gasoline purchases.
The quantity of gasoline demanded falls in response to a rise in price. This is a movement along the demand curve.