In the following question you are asked to determine, other things equal, the effects of a given change in a determinant of demand or supply for product X upon (1) the demand (D) for, or supply (S) of, X; (2) the equilibrium price (P) of X; and (3) the equilibrium quantity (Q) of X.The price of complementary consumer good Y rises. At the same time, government creates subsidies for firms producing X. When both of these occur, what outcome will occur with greatest certainty?
A. decrease D, increase S, decrease P, and effect on Q uncertain.
B. decrease D, decrease S, decrease Q, and effect on P uncertain.
C. decrease D, increase S, decrease P, and increase Q.
D. decrease D, increase S, decrease P, and decrease Q.
Answer: A
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