In the following question you are asked to determine, other things equal, the effects of a given change in a determinant of demand or supply for product X upon (1) the demand (D) for, or supply (S) of, X; (2) the equilibrium price (P) of X; and (3) the equilibrium quantity (Q) of X.
- An increase in the prices of resources used to produce X will:

Question

Quizplus · Accepted Answer

An increase in the prices of resources used to produce X will decrease the supply of X because it becomes more expensive to produce. This decrease in supply will lead to an increase in the equilibrium price and a decrease in the equilibrium quantity.

In the Following Question You Are Asked to Determine, Other