Equilibrium quantity must increase when demand
A)increases and supply does not change,when demand does not change and supply increases,and when both demand and supply increase.
B)increases and supply does not change,when demand does not change and supply increases,and when both demand and supply decrease.
C)decreases and supply does not change,when demand does not change and supply decreases,and when both demand and supply increase.
D)decreases and supply does not change,when demand does not change and supply decreases,and when both demand and supply decrease.

Question

Quizplus · Accepted Answer

According to the law of demand, when the demand for a good/service increases, the equilibrium quantity will also increase, given that the supply remains constant. Similarly, when the supply increases, the equilibrium quantity will increase, keeping the demand constant. Finally, when both demand and supply increase, the equilibrium quantity will definitely increase. Hence, option A is the correct choice.

Equilibrium Quantity Must Increase When Demand