Question

A demand shift in the market that increases demand will __________ the equilibrium price.

Answer 1

Answer: B

An increase in demand will lead to an increase in the equilibrium price.

Explanation:

A market is at equilibrium when, quantity of goods demanded and quantity of goods supplied are equal.

If there is an increase in the quantity of goods demanded, then demand becomes more than supply. This means that goods are being sold faster than they are being produced. This can lead to scarcity of goods and prices will increase.