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Change in demand vs. change in quantity demand

Thursday, July 22, 2010

A change in the quantity buyers want to purchase, prompted by any reason other than a change in price (e.g., increase in income, change in tastes), is a change in demand. In graphical terms, it is a shift of the demand curve. If, in contrast the decision to buy more or less is promted by a change in the good's price, then it is a change in quantity demanded, In graphical terms, a change in quantity demanded is a movement along an unchanging demand curve.

Cartel

An organization of independent firms producing similar products that work together to raise prices and restrict output. Cartels are illegal under U.S. antitrust laws.