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WAEC Economics 2010 Question 6

Question 6

Theory of Demand

Which of the following causes the demand curve to shift to the right?

  1. A.A reduction in the size of population
  2. B.An increase in the income of the buyer
  3. C.The availability of substitutes
  4. D.A decrease in price of the good
Show the answer and explanation

Answer: B (An increase in the income of the buyer)

Explanation

Higher income lets buyers purchase more at every price, so demand (for a normal good) increases.