If there is a change in a nonprice determinant of demand for a good, what happens to the demand curve?

• A. The demand curve becomes vertical.
• B. The supply curve shifts instead of the demand curve.
• C. The demand curve shifts either to the right or left.
• D. The demand curve moves along the curve but does not shift.

Answer: (C)

Verified step by step guidance

1. Understand that a nonprice determinant of demand refers to factors other than the good's own price that affect demand, such as consumer income, tastes, prices of related goods, expectations, and number of buyers.
2. Recall that the demand curve shows the relationship between the price of a good and the quantity demanded, holding other factors constant.
3. Recognize that when a nonprice determinant changes, it affects demand at every price level, causing the entire demand curve to shift rather than causing movement along the curve.
4. Identify that a shift to the right indicates an increase in demand (more quantity demanded at each price), while a shift to the left indicates a decrease in demand (less quantity demanded at each price).
5. Conclude that the correct effect of a change in a nonprice determinant is that the demand curve shifts either to the right or left, not that it becomes vertical, moves along the curve, or affects the supply curve.