Question

Which of the following statements is​ true?

A. If the equilibrium price and quantity move in the same​ direction, the changes were caused by a change in supply.
B. If the equilibrium price and quantity move in the same​ direction, the changes were caused by a change in demand.
C. If the equilibrium price and quantity move in opposite​ directions, the changes were caused by a change in demand.
D. None of the above.

Answer 1

D. None of the above.

Step-by-step explanation:

When there's a change in demand, the demand curve shifts and only quantity demanded changes- it either increases or reduces but price doesn't change. A change in demand is caused by factors that affect a consumer's demand for a good other than the price of the commodity.

Some of the factors that cause a change in demand include:

1. Change in income

2. Change in taste

3. Season

When there's a change in supply, the supply curve shifts and quantity supplied changes but there's no change in price. Change in supply is caused by other factors that affect supply other than price.