Asked by Brittani Barou on Jun 06, 2024

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In which of the following situations is the change in the equilibrium price of a good indeterminate?

A) When supply decreases and demand increases
B) When demand decreases and supply increases
C) When demand remains constant and supply increases
D) When supply remains constant and demand increases

Equilibrium Price

The market price where the quantity of goods supplied is equal to the quantity of goods demanded.

Supply Decreases

A situation in which the quantity of a product or service that producers are willing and able to sell at all possible prices falls.

Demand Increases

A situation where there is a rise in the quantity of a product or service that consumers are willing and able to purchase at a given price.

  • Realize the significance of market equilibrium and how supply and demand alterations modify equilibrium price and quantity.
  • Explore market circumstances to understand the effect of supply and demand dynamics on the directional movement in equilibrium price and quantity.
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Verified Answer

HB
Hannah BehailuJun 07, 2024
Final Answer :
C
Explanation :
When demand remains constant and supply increases, the equilibrium price may increase, decrease, or remain the same depending on the magnitude of the change in supply and the elasticity of both supply and demand.