In the short run,an increase in market demand will usually lead to a(n)
A)decrease in price and an increase in quantity.
B)decrease in price and a decrease in quantity.
C)increase in price and an increase in quantity.
D)increase in price and a decrease in quantity.

Question

Quizplus · Accepted Answer

An increase in market demand will lead to an increase in both price and quantity, as producers try to meet the higher demand by increasing production and charging higher prices. This is because the supply curve is upward sloping, meaning that as the demand increases, producers will have to pay more for the resources needed to produce more goods, and will pass that cost onto consumers in the form of higher prices.

In the Short Run,an Increase in Market Demand Will Usually