What Happens to Equilibrium Quantity When Simultaneously Demand Increases and Supply

question 115

Multiple Choice

What happens to equilibrium quantity when simultaneously demand increases and supply decreases?

• A)Equilibrium quantity will increase.
• B)Equilibrium quantity will decrease.
• C)Equilibrium quantity will remain the same.
• D)Equilibrium quantity may increase,decrease,or remain the same depending on the magnitude of the shifts in demand and supply.

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Definitions:

Total Revenue

The total amount of money a firm receives from the sale of its goods or services, calculated as the unit price times the quantity sold.

Wage Payment

The compensation that employees receive for their labor or services, typically expressed as an hourly rate or salary.

Profit-maximizing

A strategy or point where a business achieves its maximum level of profit by adjusting output and pricing.

Purely Competitive

A market structure characterized by many firms selling identical products, where no single firm can influence the market price.