Which statement best explains how changes in consumer tastes affect the demand curve for a good?

• A. If consumer tastes shift in favor of the good, quantity demanded increases and the demand curve shifts left at every price.
• B. Changes in consumer tastes affect supply rather than demand, shifting the supply curve instead of the demand curve.
• C. Changes in consumer tastes change the market price, which causes a movement along an unchanged demand curve.
• D. If consumer tastes shift in favor of the good, demand increases and the demand curve shifts right at every price.

Answer: (D)

Verified step by step guidance

1. Understand that the demand curve shows the relationship between the price of a good and the quantity demanded, holding all other factors constant.
2. Recognize that consumer tastes or preferences are one of the non-price determinants of demand, meaning changes in tastes shift the entire demand curve rather than causing movement along it.
3. If consumer tastes shift in favor of a good, this means consumers want more of the good at every price, which causes the demand curve to shift to the right.
4. Conversely, if consumer tastes shift away from the good, the demand curve shifts to the left, indicating a decrease in demand at every price.
5. Note that changes in consumer tastes do not affect supply or cause movement along the demand curve; instead, they shift the demand curve itself.