If the supply of spring water decreases and at the same time the demand for spring water increases, the equilibrium price and the equilibrium quantity .

Question

Quizplus · Accepted Answer

The decrease in supply and increase in demand will cause the equilibrium price to rise, as consumers are willing to pay more for a scarce product, but it is uncertain how the equilibrium quantity will be affected. It might increase if the increase in price is enough to offset the decrease in quantity demanded, or it might decrease if the decrease in supply is too significant. Therefore, the best choice is C.

If the Supply of Spring Water Decreases and at the Same