A Large Increase in the Supply of Smart TVs Occurs

question 29

Multiple Choice

A large increase in the supply of smart TVs occurs simultaneously with a smaller decrease in its demand. As a result, the equilibrium price will

• A) increase and the equilibrium quantity will decrease.
• B) increase and the equilibrium quantity will increase.
• C) decrease and the equilibrium quantity will decrease.
• D) decrease and the equilibrium quantity will increase.

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Definitions:

Demand Curve

A graphical representation that shows the quantity of a product or service desired by buyers at various price levels.

Tax

Mandatory financial charges or other types of levies imposed upon a taxpayer by a governmental organization in order to fund government spending and various public expenditures.

Buyers

Individuals or entities that purchase goods or services for personal use, resale, or as inputs to production.

Tax Revenue

The financial returns that governments earn from taxes.