In which of the following cases will the effect on equilibrium output be indeterminate (i.e.,depend on the magnitudes of the shifts in supply and demand)?

Question

Quizplus · Accepted Answer

When demand decreases and supply increases, the effect on equilibrium output will depend on the magnitudes of the shifts. If the decrease in demand is larger than the increase in supply, equilibrium output will decrease. If the increase in supply is larger than the decrease in demand, equilibrium output will increase. Therefore, the effect on equilibrium output is indeterminate.

In Which of the Following Cases Will the Effect on Equilibrium