If the demand for letters written by Abraham Lincoln is higher than the demand for letters written by John Wilkes Booth, what would have to be true for the market equilibrium prices for these letters to be equal?

Question

Andrea Hayden

Business

8 August, 16:27

If the demand for letters written by Abraham Lincoln is higher than the demand for letters written by John Wilkes Booth, what would have to be true for the market equilibrium prices for these letters to be equal?

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Answers (2)

Know the Answer?

Maurice Hughes · Answer 1

The supply of Booth letters would have to be less than the supply of Lincoln letters

Dayami Hoffman · Answer 2

C) The supply of Booth letters would have to be less than the supply of Lincoln letters

Explanation:

The equilibrium price of any good or service is determined by the quantity supplied and the quantity demanded of the goods or services. An increase in the equilibrium price results from either a decrease in the quantity supplied or an increase in the quantity demanded, or both. A decrease in the equilibrium price results from the opposite conditions: increase in the quantity supplied or decrease in the quantity demanded.

If both products have the same equilibrium price, but the demand of one of them is significantly higher than the other, the equilibrium must result from a lower quantity supplied.