If Demand Increases and Supply Decreases, What Is the Effect

question 486

Multiple Choice

If demand increases and supply decreases, what is the effect on equilibrium price and equilibrium quantity?

• A) The quantity increases and the price might rise, fall, or remain the same.
• B) The price rises and the quantity might increase, decrease or remain the same.
• C) The price falls and the quantity might increase, decrease, or remain the same.
• D) The quantity decreases and the price might rise, fall, or remain the same.

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Definitions:

Psychoanalytic Approach

A theory of psychology founded by Sigmund Freud that emphasizes unconscious motivations and conflicts in understanding human behavior.

Humanistic Approach

A psychological perspective that emphasizes individual potential for growth and the importance of self-awareness and free will.

Poor Testability

Refers to the difficulty or inability to empirically test or validate a theory or hypothesis through experimentation or observation.

Unconditional

Something given or expected without any restrictions, prerequisites, or conditions.