Exhibit 3-4 -When Both Supply and Demand Shift Right at the Same

question 41

Multiple Choice

Exhibit 3-4
-When both supply and demand shift right at the same time,

• A)the change in equilibrium price cannot be predicted, but the change in equilibrium quantity can be predicted.
• B)the change in both equilibrium price and equilibrium quantity can be predicted.
• C)the change in equilibrium price can be predicted, but the change in equilibrium quantity cannot be predicted.
• D)neither the change in equilibrium price nor equilibrium quantity can be predicted.
• E)either the equilibrium price or equilibrium quantity will change, but not both.

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Definitions:

Government Regulation

Rules or laws established by governments aimed at controlling or guiding activities within various sectors of the economy, often to protect public interests.

Command Economy

A type of economic system where the government or a central authority makes all decisions regarding the production and distribution of goods and services.

Central Government

The government entity or authority that holds the highest level of governance within a nation, responsible for national policies and administration.

Consumer Sovereignty

The theory that consumer preferences and choices dictate the production and sale of goods and services in a market.