Exhibit 4-6 Demand and supply curves

If the market supply increases and, simultaneously, market demand decreases, the new equilibrium will show:

Question

Exhibit 4-6 Demand and supply curves

If the market supply increases and, simultaneously, market demand decreases, the new equilibrium will show:

Quizplus · Accepted Answer

When market supply increases and market demand decreases, it is likely that the market price will decrease. However, the quantity exchanged could increase, decrease, or remain unchanged depending on the magnitude of the change in supply and demand. Therefore, the best answer is A.

Exhibit 4-6 Demand and Supply Curves