An increase in the equilibrium quantity of a product will result
A)when the quantity supplied of the product exceeds the quantity demanded.
B)when there is an increase in supply and an increase in demand for the product.
C)when there is an increase in supply and a decrease in demand for the product.
D)when there is an decrease in demand and a decrease in the cost of inputs used to make the product.

Question

Quizplus · Accepted Answer

An increase in the equilibrium quantity of a product indicates that there is an increase in both supply and demand for the product. This can be achieved only when both curves shift to the right, resulting in an increase in both quantity supplied and quantity demanded. Option A is incorrect because, in this case, the quantity supplied exceeds the quantity demanded, which would result in a surplus and a decrease in the price until the market reaches equilibrium. Option C is incorrect because if there is an increase in supply and a decrease in demand, the equilibrium quantity would only increase if the increase in supply is more significant than the decrease in demand, or else the equilibrium quantity would decrease. Option D is incorrect because a decrease in demand alone would decrease the equilibrium quantity, and a decrease in costs would lead to an increase in supply but would not necessarily result in an increase in demand for the product.

An Increase in the Equilibrium Quantity of a Product Will