If we observe an increase in the price of a good and a decrease 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

A decrease in the supply of the good would lead to a higher price and a lower quantity sold, as there is less of the good available in the market.

If We Observe an Increase in the Price of a Good