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Homework answers / question archive / When demand and supply both decrease, equilibrium price will _____ and equilibrium quantity will _____
When demand and supply both decrease, equilibrium price will _____ and equilibrium quantity will _____.
A. increase; decrease
B. decrease; decrease
C. remain the same; decrease
D. any of these answers are possible
When demand and supply both decrease at the same time, the impact on the equilibrium price and quantity will depend on the magnitude of change in demand and supply.
Equilibrium price will increase and the equilibrium quantity will decrease if the decline in supply is greater than a decline in demand.
Both the equilibrium price and the equilibrium quantity will decrease if the decline in demand is greater than a decline in supply.
Equilibrium price will remain the same and the equilibrium quantity will decrease if the decline in supply is equal to the decline in demand.
