When a demand curve moves
The demand curve traces consumers’ willingness to pay for different quantities, the amounts that individuals are willing and able to pay. The curve is dynamic and very changing over time.
For instance, if the price of a new iPhone rises, consumers will have an incentive to buy less and substitute it for other brands of phones. As a result, the quantity of the new iPhone that consumers are willing and able to buy will decrease which means the demand for the new iPhone will fall. Figure A shows the graphical representation of the relationship between the price of a new iPhone and the quantity demanded for a given period of time.
Image by Julie Bang © Investopedia 2019
The movement along the demand curve
As the Figure A shows, suppose that at $799 per new iPhone, 200 million iPhones will be demanded which means 200 million deals are willing to be made at the price of $799. As the price goes down, the new iPhone now become more affordable and more attractive compare to other smartphones. As a result, the quantity demand for the new iPhone rises to 500 million, the price which more consumers are willing to purchase. The dynamic and changing balance is our daily life, from supermarket to the bank you choose to deposit your money. The higher interest rate induces you to deposit more money in their bank to gain more profit from the interest income. Notice that the movement along the demand curve focuses on the quantities of the new iPhone demands by consumers that influenced by the different prices they have been offering, not events like increase in income or the preference such as how much they love the brand of iPhone.
Provide examples from your personal or professional life where you believe a demand curve shifted.
The first thing we need to know that, a shift in demand is not the same as the movement along the demand curve. A movement along the demand curve represents the possible deals and transactions that both buyers and sellers are willing to accept. A shift in demand, on the other hand, represents those possible deals and transactions that are willing to increase or decrease at "each price". In short, It does not focus on the price changes that influence the quantity demand. Instead, it represents how a certain event influences the whole curve to move on the graph.
As the COVID-19 spread worldwide, the COVID-19 outbreak hasn’t slowed Amazon down. Quite the opposite, as other businesses are affected by the COVID-19, Amazon's business is on the remarkably well-placed to benefit from the new circumstances. As lockdown orders have trapped people indoors, those huge expenditures are turning to home deliveries via Amazon. In order to keep up with the increasing demand, Amazon even plans to hire 100,000 new workers. Now, Amazon looks like a public utility during the period of lockdown orders. Moreover, It has even partnered with the Canadian government to distribute medical equipment, and with the UK government to deliver at-home testing kits. Obviously, Amazon is benefiting from the shift in demand with its well-placed business since the demand for home deliveries is increased at each price.
Reference
OpenStax College. (2016). Principles of economics. http://cnx.org/contents/69619d2b-68f0-44b0-b074 a9b2bf90b2c6@11.330
Kenton, W. (2020, January 29). Demand Curve. Retrieved from https://www.investopedia.com/terms/d/demand-curve.asp
Liu, W. (2020, April 17). Coronavirus has made Amazon a public utility – so we should treat it like one | Wendy Liu. Retrieved April 18, 2020, from https://www.theguardian.com/commentisfree/2020/apr/17/amazon-coronavirus-public-utility-workers
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