Question

If the demand and supply curves increase​ (shift outward) by identical proportions then A. equilibrium price and quantity do not change. B. equilibrium price and quantity both increase. C. equilibrium price increases but quantity falls. D. equilibrium price stays the same and quantity rises. What if the increase in demand were larger than the increase in​ supply? A. The equilibrium price and quantity decrease. B. The equilibrium price and quantity increase. C. The equilibrium price increases and the quantity decreases. D. The equilibrium price decreases and the quantity increases.

Answer 1

equal proportion of S and D

D. equilibrium price stays the same and quantity rises

D increase in greater proportion than S

B. The equilibrium price and quantity increase.

Step-by-step explanation:

An increase in supply will make for a decrease in price and increase in quantity

While, the demand increase will generate a price increase an a quantity increase.

As both are dentical proportion the price effect is nulify but the quantity rises.

If the bdemand where larger the price decrease from the ncreased supply will not offset the price increase generate for the demand increase thus, price will increase to.