The correct answer is: D. expansion of demand.
A shift in the demand curve to the right represents an increase in demand. This means that consumers are willing to buy more of a good at any given price. There are many factors that can cause an increase in demand, such as an increase in income, a decrease in the price of substitutes, or an increase in the expected future price of the good.
A shift in the demand curve to the left represents a decrease in demand. This means that consumers are willing to buy less of a good at any given price. There are many factors that can cause a decrease in demand, such as a decrease in income, an increase in the price of substitutes, or a decrease in the expected future price of the good.
The figure below shows an increase in demand. The demand curve shifts from D1 to D2. This means that at any given price, consumers are willing to buy more of the good. For example, at a price of $P1, consumers are willing to buy Q1 units of the good before the increase in demand, but they are willing to buy Q2 units of the good after the increase in demand.
The following are some of the factors that can cause an increase in demand:
- An increase in income: When consumers have more money to spend, they are willing to buy more of most goods. This is because they can afford to buy more of the good, and they may also place a higher value on the good.
- A decrease in the price of substitutes: When the price of a substitute good decreases, consumers will be less likely to buy the good in question. This is because they can now get the same satisfaction from buying the substitute good at a lower price.
- An increase in the expected future price of the good: When consumers expect the price of a good to increase in the future, they are more likely to buy the good now. This is because they can lock in a lower price by buying the good now.
- A change in consumer tastes: If consumers’ tastes change in favor of a good, they will be willing to buy more of the good at any given price. This is because they now place a higher value on the good.
I hope this helps!