MCQ
Under what condition, equilibrium price will increase and equilibrium quantity will decrease?
- AIncrease in supply.
- ✓Decrease in supply.
- CIncrease in demand.
- DDecrease in demand.
✓
Answer
Correct option: B.
Decrease in supply.
Demand curve remain unchanged, if there is a decrease in supply, supply curve and equilibrium point will shift leftwards. As a result, equilibrium price will increase and equilibrium quantity will decrease
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