In the figure given below D 1 and S 1 are the initial demand and supply curves for a commodity in the market. Figure 3.3

-Refer to Figure 3.3.If the change in the demand in this market occurred before the change in supply,then starting from the initial equilibrium:

Question

In the figure given below D 1 and S 1 are the initial demand and supply curves for a commodity in the market. Figure 3.3

-Refer to Figure 3.3.If the change in the demand in this market occurred before the change in supply,then starting from the initial equilibrium:

Quizplus · Accepted Answer

If the change in demand occurs before the change in supply, the demand curve will shift either to the right or left. If the demand curve shifts to the right, there will be an immediate shortage as demand exceeds supply at the initial price. This will cause the price to increase until it reaches a new equilibrium point where demand equals supply. In this case, the new equilibrium price will be P₂. Therefore, option B is the correct choice.

In the Figure Given Below D1 and S1 Are the Initial

In the Figure Given Below D₁ and S₁ Are the Initial