If Demand Increases and Supply Decreases, What Is the Effect

question 111

Multiple Choice

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

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

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Definitions:

High-growth Market

A market characterized by a rapid increase in demand or potential for significant expansion.

Corporate Governance

The framework of rules, practices, and processes by which a company is directed and controlled, aiming to balance the interests of stakeholders.

Stakeholder Representatives

Individuals or groups who act on behalf of the interests of stakeholders in a company or project, ensuring their voices are heard in decision-making processes.

Boards of Directors

The group of individuals elected by shareholders to oversee the management and direction of a corporation.