How would the equilibrium price in a market be affected if there were a small increase in demand and a large increase in supply ? A. The equilibrium price decreases. B. The equilibrium price increases. C. The equilibrium price would remain the same. D. More information is needed. It may increase, decrease, or remain the same.

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Business

Jayson Clarke

19 January, 22:59

How would the equilibrium price in a market be affected if there were a small increase in demand and a large increase in supply ? A. The equilibrium price decreases. B. The equilibrium price increases. C. The equilibrium price would remain the same. D. More information is needed. It may increase, decrease, or remain the same.

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Lane Collier · Answer 1

A. The equilibrium price decreases

Explanation:

When demand increase, the price rises along the quantity

When suplpy increase, the price decreases and the quantity increases

As both events generated a higher amount of quantities that increase is for sure.

Now, as the supply increase is bigger than demand curve increase, it will most probably offset the price increase from demand and most probably make the price decrease