-Refer to Exhibit 3-2.Suppose equilibrium is at point A.Something then changes and equilibrium becomes point C.Which of the following is consistent with the change in equilibrium from point A to C (assuming that good X is a normal good)?
A) There was a decrease in the number of buyers and business taxes increased.
B) There was an increase in the number of buyers and business taxes decreased.
C) There was an increase in the number of buyers and business taxes increased.
D) There was a decrease in the number of buyers and business taxes decreased.

Question

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-Refer to Exhibit 3-2.Suppose equilibrium is at point A.Something then changes and equilibrium becomes point C.Which of the following is consistent with the change in equilibrium from point A to C (assuming that good X is a normal good)?
A) There was a decrease in the number of buyers and business taxes increased. 
B) There was an increase in the number of buyers and business taxes decreased. 
C) There was an increase in the number of buyers and business taxes increased. 
D) There was a decrease in the number of buyers and business taxes decreased.

Quizplus · Accepted Answer

The change in equilibrium from point A to C can be explained by an increase in the number of buyers (shifting demand curve from D1 to D2) and a decrease in business taxes (shifting supply curve from S1 to S2). This results in an increase in both quantity demanded and quantity supplied, and a higher equilibrium price and quantity (from point A to point C).

​ ​-Refer to Exhibit 3-2.Suppose Equilibrium Is at Point A.Something Then

-Refer to Exhibit 3-2.Suppose Equilibrium Is at Point A.Something Then