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

Question

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

Quizplus · Accepted Answer

If the market supply of a product decreases, then the supply curve will shift leftward, resulting in a higher equilibrium price and a lower equilibrium quantity. Therefore, equilibrium quantity will decrease, and equilibrium price will increase.

Ceteris Paribus, If the Market Supply of a Product Decreases