If the demand for a product increases, we would expect that price will initially ________, and eventually ________.

Question

Quizplus · Accepted Answer

When the demand for a product increases, there will initially be insufficient supply for the demand, resulting in an increase in price. As producers increase their production to meet the demand, the supply will eventually catch up, which will lead to a decrease in price. However, it is important to note that this decrease in price will not necessarily occur in all cases, as other factors such as production costs may also influence the final price.

If the Demand for a Product Increases, We Would Expect