Study guides & original practice
Supply and demand shifts practice
A change in a good’s own price causes movement along a demand or supply curve. A change in another determinant can shift the curve itself.
By ExamCat · Original study lesson · Published September 24, 2026
Understand the method
Separate the curve that changes from the resulting movement on the other curve. In the basic competitive model, equilibrium occurs where quantity demanded equals quantity supplied. Predictions below assume other determinants stay fixed.
Worked example, step by step
Suppose consumer interest in a product rises at every price while its supply curve remains unchanged.
- Higher quantity demanded at each price is a rightward demand shift.
- At the old price, quantity demanded now exceeds quantity supplied.
- The new intersection generally has a higher price and quantity for ordinary upward-sloping supply and downward-sloping demand.
- The higher price creates movement along the unchanged supply curve, not a separate supply shift.
A mistake to watch for
Do not say “price rose, therefore demand increased” without specifying a shift. A higher price alone ordinarily reduces quantity demanded along a fixed demand curve.
Try it yourself: three questions
Write an answer before opening the explanation. For calculations, keep your units and intermediate steps; for concepts, state the reason for your choice.
1. Production costs rise while demand stays fixed. What happens in the basic model?
Show answer and explanation
Supply shifts left; equilibrium price rises and quantity falls under the usual curve slopes.
2. Demand and supply both increase. Is the price direction certain?
Show answer and explanation
No. Quantity generally rises, but price depends on the relative shifts.
3. What distinguishes demand from quantity demanded?
Show answer and explanation
Demand is the price-quantity relationship; quantity demanded is the amount at one particular price and set of conditions.
Build your next practice session
Mark the first step where your reasoning differed from the explanation. Turn that step into a question, answer it without looking, then change one condition in the example and explain what would change. A correct guess is a reason to revisit the method.
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