What happens when supply increases and demand does not change
What will be an ideal response?
supply curve shifts to the right, equilibrium price decreses and equilibrium quantity increases
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Tourists in foreign countries are often charged more for hand-made items at tourist shops compared to the local customers. Why?
A) The tourists are typically less informed than the local customers. B) The tourists typically have fewer available alternatives compared to the local customers. C) The shop owners can usually identify tourists. D) For all of the above reasons.
Discretionary policy deficits are associated with: a. increases in national saving. b. higher prices
c. lower outputs. d. lower interest rates. e. raising taxes.
The social security tax is a:
a. progressive tax at all income levels. b. regressive tax above a certain income level. c. proportional tax at all income levels. d. none of these.
If firms are successful in product differentiation:
a. their demand will become relatively elastic. b. consumers will believe that the firms are producing more or less identical goods. c. they can raise their prices without losing all of their customers to rivals. d. they tend to face a horizontal demand curve. e. they gradually emerge as price takers.