A town recently experienced a population decrease. In three to four sentences, explain the effect of this population decrease on the demand for clothes and tell how this situation might affect the demand curve.

Clothes is a consumer product. The demand of consumer products are highly dependent on population. If this latter decreases, the demand curve will shift downwards, which is consistent with the decrease of market size.

In the economics theory of supply and demand, it is established, particularly regarding demand, especially of consumer goods, like clothing, that it depends on the amount of goods that people are willing to acquire at a set price. In this particular case, where the consumer good - clothing - depends entirely not just on one individual buying, but also on the number of individuals that will require the good, given that there is a population decrease, the demand curve will be affected negatively, as less people will be requiring these consumer goods. In few words, less people means less demand for clothing, which will affect the demand curve in a negative, downward, way.