Over time, the equilibrium price of a gigabyte of computer memory has fallen, while the equilibrium quantity purchased has increased. Based on this we can conclude that

Question

Quizplus · Accepted Answer

The equilibrium quantity increasing indicates that demand has increased or supply has increased, or possibly both. However, since the equilibrium price has fallen, it must be the case that supply has increased more than demand has increased, leading to a surplus of computer memory and a lower price for it. Therefore, D is the correct answer as it suggests that increases in supply have exceeded increases in demand.

Over Time, the Equilibrium Price of a Gigabyte of Computer