Which of the following is NOT a factor that brings about changes in demand?

1. Analyze the question The question asks which option is NOT a factor that brings about a change in demand. In economics, "change in demand" means a shift of the whole demand curve, which is different from a "change in quantity demanded", a movement along the curve.

2. Explain the concept

• Change in quantity demanded (movement along the curve) is caused ONLY by a change in the price of the good itself.
• Change in demand (shift of the curve) is caused by non-price factors, called the determinants of demand: • Income of consumers (real income) • Tastes, fashion and preferences • Population size • Prices of related goods (substitutes and complements) • Government policy (taxes, subsidies, regulations) • Expectations about future prices or income • Advertising

3. Go through the options

• A. Change in real income: shifts the demand curve (more income means more demand for normal goods). It is a determinant.
• B. Government policy: taxes, subsidies, or bans can shift demand. It is a determinant.
• C. Increase in population: more consumers means a higher market demand. It is a determinant.
• D. Price of the good or service: this only causes a movement along the same demand curve, which is a change in quantity demanded and not a change in demand. This is NOT a factor.
• E. Taste and fashion: shifts demand. It is a determinant.

4. Answer

5. Exam tip Remember this phrase: "Own price moves you along; everything else shifts the curve." If an option mentions the price of the good itself, it is a movement along the curve and not a shift. Be careful, though: the price of a related good (a substitute or complement) does shift demand.