If the demand for a product falls and the supply stays the same
A) the market clearing price will fall and the equilibrium quantity will rise.
B) the market clearing price will rise and the equilibrium quantity will fall.
C) both the market clearing price and the equilibrium quantity will fall.
D) both the market clearing price and the equilibrium quantity will rise.
Answer: C
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If the MPC in an economy is 0.8, government could shift the aggregate demand curve rightward by $100 billion by
A. increasing government purchases by $25 billion. B. decreasing taxes by $25 billion. C. increasing government purchases by $80 billion. D. decreasing taxes by $100 billion.
In the one-period model, what do we assume about household preferences?
A) Households prefer more to less. B) Households like money. C) Households dislike taxes. D) Households care about others.
As of 2013, which was the only country in the world to be debt-free?
A. Japan B. Greece C. Korea D. Brunei
In the market for a foreign currency, a "weakening" of the dollar corresponds to a
A. larger supply of the foreign currency. B. higher dollar price of foreign currency. C. smaller demand for the foreign currency. D. lower dollar price of foreign currency.