A City of 150,000 People Has a Large Commercial Sector

A city of 150,000 people has a large commercial sector bringing in businesses from the surrounding region. In 2005, there was 2.75 million square feet of commercial space available. Five years later, after a building boom, there was 5.5 million square feet of commercial space available. Which effect will most likely occur?

A) The equilibrium price of commercial real estate will not be effected.
B) The increase in the supply of commercial real estate will lead to a corresponding increase in its price.
C) The price of commercial real estate will decrease, absent a dramatic increase in demand.
D) The increase in the supply of commercial real estate will lead to an increase in resource prices.
E) The increase in supply will cause a corresponding increase in demand.