1. Why does a market demand curve normally slope down?

Because as price decreases, quantity demanded increases.
This happens due to:
	•	Substitution effect: Consumers buy more of the cheaper good instead of similar, more expensive ones.
	•	Income effect: Lower prices increase consumers’ purchasing power, so they can buy more.
	•	Diminishing marginal utility: The additional satisfaction from consuming extra units decreases, so people only buy more if the price falls.

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2. Name some factors that could shift the demand curve out to the right.

A rightward shift means demand increases at every price. This can happen because of:
	•	Increase in consumer income (for normal goods)
	•	Increase in population
	•	Rise in popularity or preference for the product
	•	Increase in the price of substitutes
	•	Decrease in the price of complements
	•	Positive expectations about future prices or incomes

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3. Why does a firm’s supply curve normally slope up?

Because as price rises, producers are willing to supply more.
This is due to:
	•	Higher prices = higher profits, encouraging firms to produce more.
	•	Rising marginal costs: Producing more often costs more (e.g., overtime labor, resource limits), so higher prices are needed to cover those costs.

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4. Name some factors that could shift the supply curve in to the left.

A leftward shift means supply decreases at every price. This can happen because of:
	•	Higher production costs (e.g., wages, raw materials)
	•	Taxes or regulations increasing costs
	•	Decrease in the number of producers
	•	Natural disasters or supply chain disruptions
	•	Technological setbacks or breakdowns