Starting at point A on demand curve D1, determine whether the indicated event will cause demand to increase to D2 or decrease to D3, or whether there will be a movement along the demand curve D1. For each of the following events, indicate where the new point will be after the event occurs. a. Sweaters fall out of fashion: . b. There is a shortage of wool: . c. The winter is particularly long and cold this year: . d. Sweater vendors offer a sale: .

A. Point D

B. Point B

C. Point E

D. Point C

Explanation:

Here is the full question:

The figure below shows three monthly market demand curves for sweaters at a local clothing store.

Starting at point A on demand curve D1, determine whether the indicated event will cause demand to increase to D2 or decrease to D3, or whether there will be a movement along the demand curve D1.

The graph needed to answer this question can be found in the attached image.

The demand curve shows the relationship between price and quantity demanded.

The demand curve is guarded by the law of demand. The law of demand states that the higher the price, the lower the quantity demanded and the lower the price, the higher the quantity demanded.

Only a change in price leads to a movement along the demand curve.

Other factors that affect demand leads to either a leftward or rightward shift of the demand curve.

A leftward shift occurs if demand falls a rightward shift occurs if demand increases.

A. If sweater falls out of fashion, demand for sweaters fall and as a result, the demand curve shifts leftward. The points would shift from A to D.

B. If there's a shortage of wool, the price of sweaters rise. This makes sweaters more expensive. As a result, the quantity demanded falls. This leads to a movement upward along the demand curve. The demand curve moves from point A to B.

C. If it is very cold and winter lasts long, the demand for sweaters would increase. This would shift the demand curve to the right. The demand curve moves from point A to E.

D. If vendors offer a sale, they reduce the price of sweaters. The Quanitity demanded increases as a result. There's a movement along D1 from A to C.

I hope my answer helps you

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