An increase in the supply of gasoline,ceteris paribus,will cause equilibrium price
A)To rise and equilibrium quantity to fall.
B)To fall and equilibrium quantity to rise.
C)And equilibrium quantity to rise.
D)And equilibrium quantity to fall.

Question

Quizplus · Accepted Answer

An increase in the supply of gasoline, ceteris paribus, will cause a rightward shift in the supply curve. This means that there is more quantity supplied at every price level. As a result, the equilibrium price will decrease and the equilibrium quantity will increase. Therefore, choice B is the correct answer.

An Increase in the Supply of Gasoline,ceteris Paribus,will Cause Equilibrium