If the supply of bottled water decreases and at the same time the demand for bottled water increases, the equilibrium price__________ and the equilibrium quantity__________ .

Question

Quizplus · Accepted Answer

If the supply of bottled water decreases, then the equilibrium price will rise. If the demand for bottled water increases, the equilibrium quantity might increase, decrease, or stay the same depending on how much the increase in demand exceeds the decrease in supply. Therefore, the best choice is C, which shows that the equilibrium price will rise, and the equilibrium quantity might increase, decrease, or stay the same.

If the Supply of Bottled Water Decreases and at the Same