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Distinguish between contraction of demand and Decr...
1.
Distinguish between contraction of demand and Decrease in Demand.
Answer»
Contraction in Demand
Decrease in Demand
1. It is situation in which demand of goods decrease due to price increase (other things being equal)
1. In this case demand of goods decreases due change in factors other than price (other things being equal)
2. It means less demand of goods at high price.
2. It means less demand at same price or same demand at lower price.
3. Movement along the same demand curve from lower to upper point takes place.
3. Demand curve shifts downward to left side of the original curve.
4. Demand curve does not change.
4. Demand curve changes.
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