-Refer to the above figure. Which panel shows the effect of an increase in the price of a good on the demand curve of that good?
A) Panel A.
B) Panel B.
C) Both panels.
D) Neither panel.

Question

-Refer to the above figure. Which panel shows the effect of an increase in the price of a good on the demand curve of that good?
A) Panel A. 
B) Panel B. 
C) Both panels. 
D) Neither panel.

Quizplus · Accepted Answer

An increase in the price of a good does not shift the demand curve; it results in a movement along the demand curve. Therefore, neither panel would show a shift in the demand curve due to a price increase.

-Refer to the Above Figure