Question

Contraction of demand refers to ______.

Options

• downward movement along a demand curve

• upward movement along a demand curve

• shift in the demand curve

• none of these

Answer 1

Contraction of demand refers to upward movement along a demand curve.

Explanation:

Contraction of demand is a fall in quantity demanded caused by a rise in the good’s own price, with other factors unchanged. It is shown by an upward movement along the same demand curve, not by a shift.