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Suppose both supply and demand increase. What effect will this have on the equilibrium price?

1 Answer

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Answer:

A new breakeven point will be determined.

Step-by-step explanation:

The law of supply and demand suggests that price and quantity equilibrium are determined by the interaction between supply and demand. This breakeven point may vary as supply and demand change. When supply increases the price decreases and when the price decreases the demanded quantity increases. In this way, a new equilibrium price will be determined at a lower value than the previous price.

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