Movements along the demand curve
In previous lessons, we have already looked into the factors that influence demand. The quantity demanded of a normal good is inversely related to its price. That means, when the price increases, the quantity demanded decreases and vice versa. When the price changes, the change that comes to the quantity demanded is shown by a movement alone the demand curve. Such an increase in the quantity demanded is known as an extension/expansion in the demand. A decrease in the quantity demanded due to an increase in the price is known as a contraction in the demand.
Shifts of the demand curve
Shifts of the demand curve happens due to the changes in the factors other than the price of the good. In other words, the shifts of the demand curve happens when the conditions of the demand changes. These factors are explained in the previous lesson – factors influencing demand.