Question

When supply and demand for a product increase simultaneously, we can predict that both the market clearing price and the equilibrium quantity will increase. cannot predict the market clearing price, but know that the equilibrium quantity will increase. can predict that both the market clearing price and the equilibrium quantity will decrease. cannot predict the change in either the equilibrium quantity or the market clearing price.

Answer 1

Answer: Explanation:

When supply and demand for a product increase simultaneously, we cannot predict the market clearing price, but know that the equilibrium quantity will increase.

NB: We cannot predict the market clearing price because no adequate information such as government policy is provided. such information would likely affect the market clearing price either positively or negatively.

P.S: This is a business question.