Consider a Market That Is in Equilibrium

question 55

Multiple Choice

Consider a market that is in equilibrium.If it experiences a decrease in supply,what will happen?

• A)The supply curve will shift to the left and the equilibrium price and quantity will rise.
• B)The supply curve will shift to the left and the equilibrium price will increase and the equilibrium quantity will decrease.
• C)The supply curve will shift to the left and the equilibrium price and quantity will fall.
• D)The supply curve will shift to the right and the equilibrium price and quantity will fall.

---

Definitions:

Normal Good

An item that sees a rise in desire when the income of buyers increases, and experiences a decline in demand when the income of buyers drops.

Consumer Expectations

Anticipations of future prices, product quality, or available services that influence consumer decisions on spending and saving.

Normal Goods

Goods for which demand increases as consumer income rises, making them positively correlated with income changes.

College Enrollment

The process by which students register and are admitted to a college or university to pursue higher education.