A decrease in demand will cause the equilibrium price and quantity of a good to fall, ceteris paribus.

Name: A decrease in demand will cause the equilibrium price and quantity of a good to fall, ceteris paribus.
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Question

Quizplus · Accepted Answer

When demand decreases, buyers purchase fewer units of the good, which results in an excess supply of the good in the market. To clear this excess supply, sellers reduce the price of the goods. As a result, the equilibrium price and quantity of the good decrease.

A Decrease in Demand Will Cause the Equilibrium Price and Quantity