If the Equilibrium Price of a Good Decreases and the Equilibrium

question 140

Multiple Choice

If the equilibrium price of a good decreases and the equilibrium quantity of the good decreases,we can conclude that

• A) demand increased.
• B) demand decreased.
• C) supply increased.
• D) supply decreased.

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Definitions:

Utility Function

A mathematical representation in economics that explains how individuals rank preferences or choices to maximize satisfaction.

Indifference Curves

Indifference curves represent combinations of goods between which a consumer is indifferent, showing the trade-offs in consumption that yield equal satisfaction.

Horizontal Axis

In a graph or chart, the x-axis, which typically represents the independent variable or the base for measurement comparisons.

Vertical Axis

The y-axis on a graph or chart which is usually used to measure and represent the dependent variable.