Question

Distinguish between extension of demand and increase in demand​

Answer 1

Answer:

(i) When the quantity demanded rises due to a decrease in own price of the commodity, keeping other factors constant, it is known asexpansion of demand whereas when the quantity demanded rises due to a change in other facotrs other than own price of the commodity it is known asIncrease in Demand.

(ii) In expansion of demand, there is a downward movement along the same demand curve whereas the demand curve shifts rightwards in case of Increase in Demand. 

(iii) Expansion in demand is caused by a change in price of the commodity where as Increase in Demand is caused by a change in other factors such as increase in price of substitues, increase in income in case of normal goods etc.