Question

What is the difference between a change in quantity demanded and a change in demand?  Suppose the State of Maryland decrees a minimum wage of $15 an hour. What would be the effect of such legislation on the demand for labor? the supply of labor? and on wages?

Answer 1

Change in demand is different from change in quantity demanded. The change in demand occurs due to the change in factors other than own price of the product. For example: Change in income of consumer, change in the prices of related goods (substitute or complement goods), change in taste and preferences of consumer, etc. The change in demand leads to shift in the demand curve, either leftward or rightward.

Whereas, change in quantity demanded occurs due to the change in own price of the product while keeping other factors constant. When a price of the product changes, we can say that there a change in the quantity demanded for that product. It leads to movement along the demand curve of the product. It can lead to either extention in demand (fall in price of the product and rise in quantity demanded) or contraction in demand (rise in price of the product and fall in quantity demanded).

Ans 2 is given in the image: