# Microeconomics Analysis of Music Industry

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Running head: ECONOMIC PRINCIPLESECONOMIC PRINCIPLESName of the studentName of the UniversityAuthor’s Note
Price of hatsQuantity of hatsDDPEQP1P2Q1Q2Question 1The change in demand for quantity of hats relates with the change in quantity of hat withrespect to change in its price (Rubinstein 2012). On the contrary, change in demand for hatsrefers to variation in demand for hats owing to change in other factors except price. Thedifference between change in demand for quantity of hats and change in hats demand isillustrated with the help of diagram:Figure 1: Change in quantity demanded of hatsSource: (Author’s creation)The above figure reflects that change in demand for quantity of hats increases or decreases inrelation to decrease or increase in its price level. As other factors remains constant, there is noshift in demand curve. However, the variation in demand for quantity of hats occurs alongone demand curve.
Quantity of hatsPrice of hatsD1DD2QQ1Q2PFigure2: Change in demand for hatsSource: (As created by author)In this case, the rise or fall in demand for hats occur due to rise or fall in other factors withprice remaining constant. The curve moves upward due to rise in demand for hats and henceits quantity demanded increases (Canto et al. 2014). Similarly, decrease in demand for hatsleads to downward shift in demand curve and this decline the amount of hats demanded.Two factors that contribute to the change in demand for hats are:Consumer’s preferences- The demand for hat rises or falls in respect of high or lowpreference of the consumers.Customer’s income level- Demand for hat changes according to the income level ofthe consumers. Higher earning level of customers leads increase in their purchasingpower and vice-versa. As a result, the demand for it also rises or falls accordingly.

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