posted by tk on .
my mind is going blank here..can someone chime in and help:
If a new breakthrough in manufacturing technology reduces the cost of producing cd players by half, what will happen to the demand for cd players?
Thank you for using the Jiskha Homework Help Forum. It is the "supply and demand." If the price is cut in half a lot more people will feel it is affordable! "price down = demand up"
but is it a shift or a movement?
Thank you for using the Jiskha Homework Help Forum again. A "shift" to me is a "change in direction" and a "movement" is also "change of place or position or posture." To me they are synonymous!
In economics, we refer to a change in demand as a shift in the demand curve. However, a change in quantity demanded is a movement along the existing demand curve. So, my answer would be "no change in demand", but "increase in quantity" demanded as price falls.