-Refer to the Above Figure

question 256

Multiple Choice

-Refer to the above figure. Suppose that the supply curve shifts from S_A to S_B while the demand curve shifts from D_A to D_B. Which of the following is true about the results of the shifts in the supply and demand curves?

• A) The equilibrium price increases while the equilibrium quantity remains unchanged.
• B) Both the equilibrium price and equilibrium quantity increase.
• C) The equilibrium price remains unchanged while the equilibrium quantity increases.
• D) Both the equilibrium price and equilibrium quantity remain unchanged.

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Definitions:

Short-Term Security

A financial instrument with a maturity date of one year or less, typically used for short-term financing needs.

Mortgage Markets

The financial markets where mortgages are originated, bought, and sold, including both primary and secondary markets.

Fannie Mae

A government-sponsored enterprise established to expand the flow of mortgage money by creating a secondary market for mortgage loans.

Money Market Instrument

Short-term financial instruments that are highly liquid and considered safe, such as treasury bills and certificates of deposit.