A shift in the demand curve to the left, all other things unchanged:
A) will cause the supply curve to shift to the left, too.
B) will cause a movement upward along the supply curve and a higher equilibrium price.
C) will cause a movement downward along the supply curve and a lower equilibrium quantity.
D) will result in a lower equilibrium price and greater equilibrium quantity.
Ans: C) will cause a movement downward along the supply curve and a lower equilibrium quantity.
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Real income will rise from one year to the next if nominal income:
A. Falls and the price level falls faster B. Rises and the price level rises faster C. Falls and the price level rises D. Falls faster than the price level
Refer to the above diagram. Assume that G and T1 are the relevant curves, the economy is currently at A, and the full-employment GDP is B. This economy has a(n):
A. cyclically adjusted budget surplus. B. actual budget deficit. C. actual budget surplus. D. cyclically adjusted budget deficit.