FIGURE 3-5
-Refer to Figure 3-5.If supply were to increase and demand were to decrease simultaneously,this would lead to

Question

Quizplus · Accepted Answer

When supply increases, it tends to lower the price and increase the quantity. When demand decreases, it tends to lower both the price and the quantity. The simultaneous occurrence of these changes will definitely decrease the equilibrium price, but the change in equilibrium quantity is indeterminate because it depends on the relative magnitudes of the shifts in supply and demand.

FIGURE 3-5 -Refer to Figure 3-5.If Supply Were to Increase and Demand