Changing Demand and Supply

We have seen how demand and supply interact, giving rise to an equilibrium price and quantity traded. In order to use these concepts for practical purposes, we need to think about the ways in which demand and supply can change, and what happens when they do change. Remember that economists think of "a change in demand" as a shift of an entire demand curve. Thus, a change in any one of the nonprice determinants -- a change in income, population, or expectations, for example -- would shift the demand curve to the right or to the left.

Likewise supply. By the way, always think of a shift in supply as "leftward" or "rightward," not "up" or "down." Thinking in terms of "up" and "down" will cause confusion!