A decrease in supply, holding demand constant, will cause:

Name: A decrease in supply, holding demand constant, will cause:
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Question

Quizplus · Accepted Answer

A decrease in supply means that there is less of a product available in the market, which will cause the price to increase due to a shortage of the product. As a result, consumers will buy less of the product, which leads to a smaller quantity sold. Therefore, the correct answer is B) Higher prices and a smaller quantity sold.

A Decrease in Supply, Holding Demand Constant, Will Cause