Assume that the demand curve for DVD players shifts to the left and the supply curve for DVD players shifts to the right, but the supply curve shifts less than the demand curve. As a result
A) both the equilibrium price and quantity of DVD players will decrease.
B) the equilibrium price of DVD players will decrease; the equilibrium quantity may increase or decrease.
C) the equilibrium price of DVD players may increase or decrease; the equilibrium quantity will increase.
D) the equilibrium price of DVD players will decrease; the equilibrium quantity will increase.
A
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If the Federal Reserve raises its target inflation rate, the monetary policy reaction function ________ and the aggregate demand curve ________.
A. shifts upward to the left; shifts to the right B. shifts downward to the right; shifts to the left C. shifts downward to the right; shifts to the right D. shifts upward to the left; shifts to the left
Lucinda starts a business consulting company. She makes all the business decisions and bears the risk of running the business. The typical payment for Lucinda's work is ________
A) all the revenue greater than her opportunity cost B) all the revenue greater than the capital investment C) a normal profit D) an economic profit
A decrease in the price level will lead to
A) a decrease in the real interest rate and an increase in net exports. B) an increase in the real interest rate and an increase in net exports. C) a decrease in the real interest rate and a decrease in net exports. D) an increase in the real interest rate and a decrease in net exports.
Exhibit 4-1 Supply and demand data Price Quantitydemanded Quantitysupplied $1.00 500 50 1.50 450 150 2.00 400 250 2.50 300 300 3.00 150 350 In Exhibit 4-1, suppose that a reduction in the price of an important input used to produce the good causes an increase in quantity supplied of 150 units at every price level. Assuming that demand does not change, the new equilibrium price will be:
A. $1.00. B. $1.50. C. $2.00. D. $2.50.