Suppose that the supply of music CDs increases. What happens to the equilibrium price and equilibrium quantity of music CDs?
A) increase in the equilibrium price and a decrease in the equilibrium quantity
B) increase in the equilibrium price and an increase in the equilibrium quantity
C) decrease in the equilibrium price and an increase in the equilibrium quantity
D) decrease in the equilibrium price and a decrease in the equilibrium quantity

Question

Quizplus · Accepted Answer

When the supply of an item, such as music CDs, increases, the equilibrium price typically decreases due to the higher availability of the product, and the equilibrium quantity increases as more of the product is available for sale at lower prices.

Suppose That the Supply of Music CDs Increases