-If the supply of and demand for a product decrease at the same time,then equilibrium
A) quantity and equilibrium price must both decline.
B) quantity must decline,but equilibrium price may either rise,fall,or remain unchanged.
C) price must fall,but equilibrium quantity may either rise,fall,or remain unchanged.
D) quantity must fall and equilibrium price must rise.

Question

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-If the supply of and demand for a product decrease at the same time,then equilibrium
A) quantity and equilibrium price must both decline.
B) quantity must decline,but equilibrium price may either rise,fall,or remain unchanged.
C) price must fall,but equilibrium quantity may either rise,fall,or remain unchanged.
D) quantity must fall and equilibrium price must rise.

Quizplus · Accepted Answer

If the supply and demand for a product decrease at the same time, it will lead to a decrease in the equilibrium quantity. However, the equilibrium price can either rise, fall or remain unchanged depending on the extent of the decrease in supply and demand. If the decrease in supply is more than the decrease in demand, the equilibrium price will rise, and if the decrease in demand is more than the decrease in supply, the equilibrium price will fall. If the decrease in supply and demand is equal, the equilibrium price will remain unchanged.

​ ​-If the Supply of and Demand for a Product Decrease

-If the Supply of and Demand for a Product Decrease