In which of the following scenarios would we definitely know that price will increase but we'd be unable to determine how quantity changes?

Choose 1 answer:
(A) $D \downarrow$ and $S \uparrow$
(B) $D \uparrow$ and $S$ no change
(c) $D \downarrow$ and $S \downarrow$
(D) $D \uparrow$ and $S \uparrow$
(E) $D \uparrow$ and $S \downarrow$

Question

In which of the following scenarios would we definitely know that price will increase but we'd be unable to determine how quantity changes?

Choose 1 answer:
(A) $D \downarrow$ and $S \uparrow$
(B) $D \uparrow$ and $S$ no change
(c) $D \downarrow$ and $S \downarrow$
(D) $D \uparrow$ and $S \uparrow$
(E) $D \uparrow$ and $S \downarrow$

Accepted Answer

∻Solution∻ ‖ a ⋮ Demand Increase and Supply Increase: When both demand ($D$) and supply ($S$) increase, the price will definitely increase because the increase in demand puts upward pressure on the price. However, the change in quantity is uncertain because it depends on the relative magnitudes of the shifts in demand and supply. ‖ ∻Answer∻ ⚹ (D) $D \uparrow$ and $S \uparrow$ ⚹ ∻Key Concept∻ ⚹ Simultaneous Increase in Demand and Supply ⚹ ∻Explanation∻ ⚹ When both demand and supply increase, the price will definitely increase due to the higher demand. However, the change in quantity is uncertain because it depends on the relative magnitudes of the shifts in demand and supply. ⚹◊How does a change in demand and supply affect price and quantity in a market according to the law of supply and demand in microeconomics?⍭ Generate me a similar question◊

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