Which of the following best describes what happens to the demand curve when quantity demanded decreases in response to an increase in price?

• A. The demand curve shifts to the right.
• B. There is a movement down along the demand curve.
• C. The demand curve shifts to the left.
• D. There is a movement up along the demand curve.

Answer: (D)

Verified step by step guidance

1. Understand the difference between a shift in the demand curve and a movement along the demand curve. A shift occurs when a non-price factor changes demand, while a movement along the curve happens due to a change in price.
2. Recall that the demand curve shows the relationship between price and quantity demanded, holding other factors constant.
3. When the price of a good increases, the quantity demanded typically decreases, which is represented as a movement along the demand curve, not a shift.
4. Specifically, an increase in price causes a movement upward (or leftward) along the demand curve, reflecting a lower quantity demanded at the higher price.
5. Therefore, the correct description is that there is a movement up along the demand curve when quantity demanded decreases due to an increase in price.