Extension and ContractionThis is a featured page

Any movement along the demand curve can be referred as an extension/contraction of demand. This is affected by a change in price.

It should not be confused with a movement in the demand curve. An extension and contraction are caused by a shift in the supply curve, moving along the demand curve.

For example, tickets for a theatre performance could be $10 and the quantity demanded per week is 5000 tickets. If the price is lowered to $8, the quantity demand increases to 6000 tickets per week. If the price, however, were to rise to $12, the quantity demanded might fall to 4000 tickets per week. The demand curve could extend or contract.


Simon_Creally
Simon_Creally
Latest page update: made by Simon_Creally , Oct 21 2007, 2:55 PM EDT (about this update About This Update Simon_Creally Edited by Simon_Creally

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