Question

In a scenario where we expect a shift in both supply and demand, if the demand for a product increases, the price will always increase

True/False

Answer 1

The correct answer is: False.

Step-by-step explanation:

Shifts in demand and supply curves can be left or right. In the case the quantity demanded for a product increases, it implies the price for that product will decrease moving the demand curve to the right. As the prices lowered, the quantity supplied will decrease, moving the supply curve to the left.

Thus, the fact that the quantity demanded increases does not imply that the price will always increase.