If the number of demanders for granite counter tops decreases at the same time as the number of suppliers of granite counter tops decreases and the shift in supply is greater than the shift in demand, both the equilibrium price and quantity of granite counter tops will fall.

Question

Quizplus · Accepted Answer

When both the demand and supply decrease, the effect on equilibrium price is ambiguous without knowing the exact magnitudes of the shifts. However, if the shift in supply is greater than the shift in demand, it typically leads to a decrease in quantity but could lead to an increase, decrease, or no change in price depending on the relative shifts.

If the Number of Demanders for Granite Counter Tops Decreases