Question

Say that the original supply curve for avocados is the curve labeled S and the demand curve for avocados is the curve labeled D. If the supply curve moved from S to S1 and the demand curve did not move, at the new equilibrium we would conclude that
A. supply decreased and quantity demanded decreased.
B. supply increased and quantity demanded decreased.
C. price decreased and quantity demanded did not change.
D. supply increased and quantity demanded increased.
E. demand increased and quantity supplied increased.

Answer 1

Answer:

D. supply increased and quantity demanded increased.

Explanation:

When supply curve moved from s to s1 , supply increased . demand curve did not move . Then the new equilibrium will shift towards the lower price with demand also showing increasing trend to balance supply but at lower price.