True or False: An increase in the demand for notebooks raises the quantity of notebooks demanded but not the quantity supplied.
2 answers:
Answer:
The statement is False
Explanation:
Generally speaking, the statement is false considering the demand and supply curve. In this curve, when there is increase in demand, its implies that the consumers of the notebook still derived satisfaction on it and as such the producer of the notebook produces more and supply to the market will increase so that equilibrium point will be achieved. Until when law of diminishing return set in, and the people are not deriving satisfaction again, that is when the product may not be readily available.
Again if the supply curve is vertical, that is the producer is producing and supplying at fixed rate without putting into consideration the demands in the market, there will not be corresponding increase in supply with demands which can make statement to true.
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Answer:
.d. The equilibrium quantity would increase, and the effect on equilibrium price would be ambiguous.
Explanation:
The use of the machine would increase the supply of lattes and price falls. The supply curve would shift to the right. If scientists discover that coffees reduce heart attack, the demand for coffee would increase and price would increase. The demand curve would shift to the right.
The combined effect would be a rise in equilibrium quantity and an indeterminate effect on equilibrium price.
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