a
an increase in equilibrium price and a decrease in equilibrium quantity
b
a decrease in equilibrium price and an increase in equilibrium qantity
c
a decrease in equilibrium price and equilibrium quantity
d
an increase in equilibrium price and quantity
Explanation
Correct Option
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Brainpill
10 years ago
The selected answer is wrong! THE CORRECT ANSWER IS A
A decrease in supply will cause an increase in the equilibrium price and a decrease in the equilibrium quantity of a good.
1. The decrease in supply creates an excess demand at the initial price.
a. Excess demand causes the price to rise and quantity demanded to decrease.
