Suppose the Number of Buyers in a Market Increases and a Technological

question 171

Multiple Choice

Suppose the number of buyers in a market increases and a technological advancement occurs also. What would we expect to happen in the market?

• A)Equilibrium price would decrease, but the impact on equilibrium quantity would be ambiguous.
• B)Equilibrium price would increase, but the impact on equilibrium quantity would be ambiguous.
• C)Equilibrium quantity would decrease, but the impact on equilibrium price would be ambiguous.
• D)Equilibrium quantity would increase, but the impact on equilibrium price would be ambiguous.

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Definitions:

Breach of Contract

A situation where one or more parties involved in a contract fail to fulfil their legal obligations as outlined in that contract.

Writing Requirement

A legal stipulation that certain kinds of contracts must be in writing to be enforceable.

Purchase Price

The amount of money that is required to buy something.

Incorporation

The process of legally declaring a corporate entity to be separate from its owners, thereby providing limited liability and other benefits.