Final answer:
The demand curve can shift due to factors like changes in tastes and preferences, income levels, prices of related goods, future price expectations, population changes, and expected future income. These do not include changes in the price of the good itself, which cause movement along the curve rather than a shift.
Step-by-step explanation:
Several factors can cause a shift in the demand curve in markets for goods and services. These factors influence the willingness and ability of consumers to buy at different prices and can be remembered by the acronym TIPPEE:
- Tastes and Preferences: Changes in consumer tastes and preferences can increase or decrease demand for particular goods and services.
- Income: As consumer incomes rise, the demand for normal goods increases, and demand for inferior goods decreases. Conversely, when incomes fall, the situation reverses.
- Prices of Related Goods: The demand for a good can be affected by the prices of related goods, such as substitutes and complements.
- Expectations of Future Prices: If consumers expect prices to rise in the future, they may increase their current demand. If they expect prices to drop, they may delay their purchase, decreasing current demand.
- Population: An increase in the population increases the overall demand for goods and services, while a decrease has the opposite effect.
- Expected Income: Similar to price expectations, if people expect their income to rise in the future, they may be more willing to spend now, thus increasing demand.
It's important to emphasize that a change in the price of the good or service itself does not shift the demand curve but instead causes a movement along the curve.