A rightward shift in a demand curve and a leftward shift in a supply curve both result in a
A)Lower equilibrium price.
B)Lower equilibrium quantity.
C)Higher equilibrium price.
D)Higher equilibrium quantity.

Question

Quizplus · Accepted Answer

A rightward shift in demand curve indicates an increase in demand, which results in a higher equilibrium price. On the other hand, a leftward shift in supply curve indicates a decrease in supply, which would normally lead to a higher price. However, when both shifts occur simultaneously, the result can be ambiguous as the equilibrium price could either increase or decrease. However, in most cases, the shift in demand curve has a stronger effect on price than the shift in supply curve.

A Rightward Shift in a Demand Curve and a Leftward