If we observe an increase in the price of a good and an increase in the amount of the good bought and sold, this could be explained by
A) an increase in the supply of the good.
B) an increase in the demand for the good.
C) a decrease in the demand for the good.
D) a decrease in the supply of the good.

Question

Quizplus · Accepted Answer

An increase in demand for a good leads to a higher equilibrium price and quantity, explaining the observed increase in both price and amount bought and sold.

If We Observe an Increase in the Price of a Good