Asked by Simer Sidhu on Jun 17, 2024
Verified
When supply falls and demand stays the same,
A) equilibrium quantity rises.
B) equilibrium quantity falls.
C) equilibrium quantity stays the same.
Equilibrium Quantity
At the market equilibrium price, the amount of goods or services offered matches the amount requested.
Supply Falls
A condition in which the quantity of a product or service available in the market decreases, potentially leading to higher prices.
- Comprehend how alterations in supply and demand influence the equilibrium price and quantity.
Verified Answer
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Final Answer :
B
Explanation :
When supply falls while demand remains constant, the equilibrium point shifts to the left, which results in a higher equilibrium price but a lower equilibrium quantity. Therefore, the correct answer is B.
Learning Objectives
- Comprehend how alterations in supply and demand influence the equilibrium price and quantity.
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