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16 April, 10:00

Z is a normal good. The equilibrium price and equilibrium quantity of Z in the year 2011 was $25 and 60 units, respectively. In 2014, the equilibrium price of Z had decreased to $15 and the equilibrium quantity had also decreased to 50 units. Other things remaining the same, which of the following could explain this change? a. Shift of the supply curve of Z to the rightb. Shift of the supply curve of Z to the leftc. Shift of the demand curve for Z to the rightd. Shift of the demand curve for Z to the left

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  1. 16 April, 10:11
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    D) Shift of the demand curve for Z to the left

    Since both the equilibrium quantity and price decreased.

    Explanation:

    A rightward shift of the demand curve should increase both the equilibrium price and quantity.

    A rightward shift of the supply curve should increase the equilibrium quantity and decrease the equilibrium price.

    A leftward shift of the supply curve should increase the equilibrium price and decrease the equilibrium quantity.
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