When supply and demand for a product decrease simultaneously, we
A) can predict that both equilibrium price and quantity will increase.
B) can predict that both equilibrium price and quantity will decrease.
C) cannot predict equilibrium price, but know that equilibrium quantity will decrease.
D) cannot predict the change in either the equilibrium quantity or equilibrium price.
C
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An example of a zero-sum game is
A) exchange. B) a consumer purchasing a used car from a used car dealer. C) the prisoners' dilemma. D) poker.
Refer to Monopoly Supplier and Manufacturer. The vertical merger causes social gain to
The following questions refer to the accompanying diagram, which shows a monopoly leather supplier selling leather to a monopoly shoe manufacturer. The leather supplier initially produces QM and charges the shoe manufacturer PM. Then the leather supplier acquires the shoe manufacturer in a vertical merger.
a. increase by area A + B.
b. increase by area E + H.
c. decrease by area B + D + G.
d. remain equal to area A + B + C + D + F + G.