hy does the equilibrium price not increase when there is a decrease in – InterviewSolution

1.	hy does the equilibrium price not increase when there is a decrease in its supply and itsdemand is perfectly elastic?
Answer» Ans :- Increasesin bothsupplyand demand curveswillimply thatequilibriumquantity increasesbutequilibrium priceis indeterminate. That isequilibrium price can increase,decrease, ornotchange depends on whether demandincrease(shift) is greater than that ofsupplyshift.

Discussion

No Comment Found

Related InterviewSolutions

6. Name any three medicinal plants with their uses.
Name any four plants with medicinal value.
What role does opposition political party play in Indian politics?oes democracy produce an 'accountable government?
Name the program that allows high level language to interrelate with a hardware device.
Explain the statement,' there is a general consensus of high level of buffer stock of food grains is very undesirable and wasteful.' (5mark question)
who was Columbus
ind out where records are kept in your village orty. Who writes these records? Is there an archive?ho manages it? What kinds of documents are storedere? Who are the people who use it?
Project:Take weights of five of your friends.Find out what their weights will be on themoon and the Mars.
Give four examples of adjacent angles in daily life.
when do they use this direction in daily life