An increase in the supply of a good will cause
A) an increase in equilibrium price and quantity.
B) a decrease in equilibrium price and quantity.
C) an increase in equilibrium price and a decrease in equilibrium quantity.
D) a decrease in equilibrium price and an increase in equilibrium quantity.

Question

Quizplus · Accepted Answer

An increase in the supply of a good, assuming demand remains constant, typically leads to a decrease in the equilibrium price because there is more of the good available. At the same time, the quantity of the good sold at equilibrium increases because the lower price encourages more consumers to buy the product.

An Increase in the Supply of a Good Will Cause