Suppose Demand Decreases and Supply Decreases, but Demand Decreases More

question 25

Multiple Choice

Suppose demand decreases and supply decreases, but demand decreases more than supply.What will happen to equilibrium price and quantity?  

• A) Equilibrium price will increase and quantity will increase. 
• B) Equilibrium price will decrease and quantity will decrease. 
• C) Equilibrium price is ambiguous and quantity will decrease. 
• D) Equilibrium price will decrease, and quantity is ambiguous.

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Definitions:

Melting Point

The melting point is the temperature at which a solid substance transitions to its liquid phase under atmospheric pressure.

Physical Change

A physical change is a change in a substance that does not involve a change in its chemical composition, such as melting, freezing, or cutting.

Specific Heat

The amount of heat per unit mass required to raise the temperature of a substance by one degree Celsius.

Specific Heats

The amount of heat per unit mass required to raise the temperature of a substance by one degree Celsius, a physical property that varies among different substances.