Demand and supply

2. Assumption of law of demand

2.1. More information on assumption of law of demand

Shifts in the demand curve versus movements along the demand curve 
When any of the determinants of demand apart from the price change the entire demand curve shifts. 
This is known as a "change in demand" as opposed to a change in the "quantity demanded" which is movement along the same demand curve. 
An increase in demand or a rightward shift of the demand curve is shown in Figure 

Figure 2.6: A rightward shift in the demand curve Figure 2.6 shows a rightward shift in the demand curve from DD to D1D1. An increase in 'demand' is therefore caused by a factor other than the commodity's own price. The commodity's price remains constant at P while the amount purchased has been increased from Q1 to Q2. 
This could be due to one or more of the following factors: 
An increase in the price of a substitute commodity 
A decrease in the price of a complementary commodity
An increase in a household's real disposable income.
A change of tastes or fashion in favour of a commodity
A successful advertising campaign
The increased availability of credit to consumers
Government legislation making the use of certain commodities such as fire extinguishers in cars mandatory.