8. Equilibrium quantity must increase when demand a. increases and supply does n

Question

8. Equilibrium quantity must increase when demand
a. increases and supply does not change, when demand does not change and supply increases, and when both demand and supply increase.
b. increases and supply does not change, when demand does not change and supply increases, and when both demand and supply decrease.
c. decreases and supply does not change, when demand does not change and supply decreases, and when both demand and supply increase.
d. decreases and supply does not change, when demand does not change and supply decreases, and when both demand and supply decrease.

Explanation / Answer

Keeping supply unchanged, when demand increases, demand curve shifts rightward & equilibrium quantity increases.

Keeping demand unchanged, when supply increases, supply curve shifts rightward & equilibrium quantity increases.

When both demand & supply increase, both curves shift rightward & equilibrium quantity increases.

So, correct option is (a).

Related Questions

Navigate

• Browse (All)
• Browse 8
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.