Other things being equal, an increase in supply will lead to
A.
a fall in price and an increase in quantity bought and sold
B.
an increase in price and increase in quantity bought and sold
C.
a fall in price and a fall in quantity bought and sold
D.
an increase in quantity supplied and demanded only
Correct Answer: Option A
Explanation
A change in supply will cause equilibrium price and output to change inopposite directions. a. An increase in supply will cause a reduction in the equilibrium price and an inase in the equilibrium quantity of a good.
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