Ceteris paribus, if the market demand for a product increases, then equilibrium quantity will (be) ____ and equilibrium price will (be) ____.
A)increase; indeterminate
B)decrease; decrease
C)indeterminate; decrease
D)increase; increase

Question

Ceteris paribus, if the market demand for a product increases, then equilibrium quantity will (be) ____ and equilibrium price will (be) ____.
A)​increase; indeterminate
B)​decrease; decrease
C)​indeterminate; decrease
D)​increase; increase

Quizplus · Accepted Answer

An increase in market demand will result in an increase in both equilibrium price and equilibrium quantity. This is because as demand increases, there will be upward pressure on prices, and suppliers will increase production to meet the higher demand, resulting in a higher quantity supplied.

Ceteris Paribus, If the Market Demand for a Product Increases