The demand curve shifts from d1 to d2 which from

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Unformatted text preview: am sold. How an Increase in Demand Affects the Equilibrium Price of Ice-Cream Cone Cone 1. Hot weather 1. increases the demand for ice cream… for •An event that raises An quantity demanded at any given price shifts Supply the demand curve to the right. The equilibrium quantity New equilibrium both rise. $2.50 2.00 2….resulting 2….resulting in a higher price… price… D2 D1 7 FIGURE 10 10 Quantity of IceCream Cones 3….and a higher quantity sold. quantity •Here, an abnormally Here, hot summer causes buyers to demand more ice cream. The demand curve shifts from D1 to D2, which from which causes the equilibrium price to rise from $2 to $2.5 and the equilibrium quantity to rise from 7 to 10 cones. to Shift in Curves vs Movements along Curves Shift A shift in the supply curve is called a “change in supply”, and a shift in the demand curve is called a “change in demand”. A movement along a fixed supply curve is called a “change in the quantity supplied”, and a movement along a fixed demand c...
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