question archive If supply decreases but demand remains the same, we can conclude that the new equilibrium: a
If supply decreases but demand remains the same, we can conclude that the new equilibrium: a
Subject:MarketingPrice:2.88 Bought3
If supply decreases but demand remains the same, we can conclude that the new equilibrium:
a. price must fall but market quantity is indeterminate.
b. quantity must increase but market price is indeterminate.
c. price must increase but market quantity is indeterminate.
d. quantity must decrease but market price is indeterminate.
e. price must increase and quantity must increase.
f. price must increase and quantity must decrease.
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- The correct answer choice is: f. price must increase and quantity must decrease.
If there is a decrease in supply, the supply curve shifts to upwards to the left. If the demand remains the same, then the effect will be a rise in the equilibrium point, with a higher equilibrium price and a lower equilibrium quantity.
