A rightward shift in supply and a leftward shift in demand would cause an unambiguous decrease in the equilibrium quantity in a market.

Question

Quizplus · Accepted Answer

A rightward shift in supply indicates an increase in supply, while a leftward shift in demand indicates a decrease in demand. The effect on equilibrium quantity would depend on the relative magnitudes of these shifts. If the increase in supply is larger than the decrease in demand, the equilibrium quantity could actually increase, and vice versa. Therefore, the change in equilibrium quantity is not unambiguous.

A Rightward Shift in Supply and a Leftward Shift in Demand