Explain how the relative magnitudes of changes in supply and demand can affect equilibrium price and quantity, if supply and demand change simultaneously
Please provide the best answer for the statement.
When supply and demand change simultaneously and have opposite effects on either equilibrium quantity or price, the relative magnitudes of the changes in supply and demand will determine which shift will have the greatest effect. For example, given that both supply and demand increase, when the shift in supply is greater than the shift in demand the equilibrium price decreases. When the shift in supply is less than the shift in demand, the equilibrium price increases. As for equilibrium quantity, given that supply increases while demand decreases, a greater shift in supply results in an increase in quantity and a greater shift in demand results in a decrease in quantity.
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Working efficiently, Jordan can write 3 essays and outline 4 chapters each week. It must be true that:
A. 6 essays and 0 chapter outlines would be unattainable. B. 3 essays and 5 chapter outlines would be unattainable. C. 2 essays and 3 chapter outlines would be efficient. D. 4 essays and 3 chapter outlines would be both attainable and efficient.
If both the demand for a product and the supply of it decrease, then the equilibrium quantity will ________ and the equilibrium price will ________.
A) increase; either increase, decrease, or remain constant B) decrease; either increase, decrease, or remain constant C) increase; increase D) increase; decrease
The main purpose of expansionary monetary policy is to reduce interest rates.
Answer the following statement true (T) or false (F)
Fiscal policy is typically:
A. extremely flexible provided policy lags are short. B. extremely flexible because most government spending is discretionary. C. difficult to implement quickly. D. flexible despite the presence of implementation problems.