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TABLE 4-2 PriceD1 $16 $14 $12 $10 $8 $6 12 15 18 21 17 15 13 10 13 15 18 20 27 2

ID: 1127202 • Letter: T

Question

TABLE 4-2 PriceD1 $16 $14 $12 $10 $8 $6 12 15 18 21 17 15 13 10 13 15 18 20 27 21 18 15 27 Refer to Table 4-2. Suppose that Di and S1 are the prevailing demand and supply curves for a product. Which of th following will bpen in the schedule changes from D1 to D2? Oa. The equilibrium quantity decreases from 15 to 13. O b. The equilibrium price decreases from $12 to $10. uppose that D and S1 are the prevailing demand and supply curves for a product. Which of the following will happen in the c. The equilibrium price increases from $12 to $14. od. The equilibrium quantity increases from 13 to 18. Moving to the next question prevents changes to this answer. 13

Explanation / Answer

Option c: Eq price increases from $12 to $14

When D1 = S1, eq price = $12 and eq quantity = 13.
When D2 = S1, eq price = 14 and eq quantity = 15