Question

In which of the following instances is the effect on equilibrium price (whether it rises, falls, or remains unchanged) dependent on the magnitude of the shifts in supply and demand?

Answer 1

Answer:

Hi

When a curve moves, the price and the amount of equilibrium change. An increase in demand causes an increase in both price and the amount of balance. A decrease in demand causes a decrease in both the price and the amount of equilibrium.

In the real world, it is easier to predict changes in supply than changes in demand. Physical factors that affect supply, such as weather or the availability of inputs, are easier to control than changes in restrictions that affect demand. Taking into account supply and demand, we can also better anticipate the effects of shifts in the supply curve. An excess of demand causes an increase in the price and a decrease in the quantity demanded, when the supply of a good or a reduced service, the equilibrium price of that good or service increases and the quantity of controlled equilibrium. In summary, an increase in the supply of a good causes a decrease in the price and an increase in the amount of equilibrium. A decrease in supply causes an increase in price and a decrease in the amount of balance.

Explanation: