If the supply and demand curves for a product both decrease, then equilibrium

A. quantity must fall and equilibrium price must rise.

B. price must fall, but equilibrium quantity may rise, fall, or remain unchanged.

C. quantity must decline, but equilibrium price may rise, fall, or remain unchanged.

D. quantity and equilibrium price must both decline.

Question

Deon

Business

18 October, 09:15

If the supply and demand curves for a product both decrease, then equilibrium

A. quantity must fall and equilibrium price must rise.

B. price must fall, but equilibrium quantity may rise, fall, or remain unchanged.

C. quantity must decline, but equilibrium price may rise, fall, or remain unchanged.

D. quantity and equilibrium price must both decline.

+5

Answers (1)

Know the Answer?

Malachi Middleton · Answer 1

Letter c is correct

Explanation:

In this case, the amount of supply will be smaller and the price may remain, rise or fall. The factor that influences this price behavior is the law of supply and demand, it will determine what will be the prices of a market. So if there is a balance between supply and demand, the most likely to happen is price stabilization, which can be changed more or less depending on other economic factors that may arise, such as the emergence of a competitor.