Suppose that the market for computers is initially in equilibrium. Further suppose that there is an increase in the price of computer software. The equilibrium price will rise; the equilibrium quantity will fall.

Question

Quizplus · Accepted Answer

An increase in the price of computer software, a complement to computers, would likely decrease the demand for computers as the overall cost of owning and operating a computer increases. This decrease in demand would lead to a lower equilibrium price and quantity for computers, not a rise in price.

Suppose That the Market for Computers Is Initially in Equilibrium