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Distinguish between Expansion of demand and Contraction of demand. - Economics

Distinguish Between

Distinguish between

Expansion of demand and Contraction of demand.

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Solution

  Expansion of demand Contraction of demand
1. Expansion of demand refers to a rise in demand only due to a fall in price. Contraction of demand refers to a fall in the demand only due to a rise in price.
2. Expansion of demand takes place solely due to falling in price. All other factors affecting demand remain constant. Contraction of demand takes place solely due to a rise in price. All other factors affecting demand remain constant.
3. Expansion of demand is shown by a downward movement on the same demand curve. Contraction of demand is shown by an upward movement on the same demand curve.
4. Diagrammatic representation:

Diagrammatic representation:

Concept: Factors of Demand
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APPEARS IN

Balbharati Economics 12th Standard HSC Maharashtra State Board
Chapter 3.1 Demand Analysis
Exercise | Q 3. (2) | Page 25
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