PRC-3 · Chapter 10 · Question 9 of 70
If there is a simultaneous outward shift of the demand curve (increase in demand) and an inward shift of the supply curve (decrease in supply) for a specific product, what will definitely happen?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Equilibrium price will definitely increase
Explanation
Both an increase in demand and a decrease in supply push the price upward. The effect on quantity depends on the magnitude of the shifts, but the price will unequivocally rise.
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