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How does an increase in price affect equilibrium price and quantity?If there is an increase in supply for goods and services while demand remains the same, prices tend to fall to a lower equilibrium price and a higher equilibrium quantity of goods and services.
How does an increase in the price of a commodity affect the quantity demanded?Demand curve
The demand curve will move downward from the left to the right, which expresses the law of demand: As the price of a given commodity increases, the quantity demanded decreases (all else being equal). When the price of commodities decreases, the quantity demanded will then increase.
How will equilibrium price and quantity of a commodity be affected if demand increases and supply is perfectly inelastic?When demand is perfectly inelastic, then change in supply does not affect the equilibrium quantity. It only changes the equilibrium price. The change may be either an 'Increase in Supply' or 'Decrease in Supply'.
How is the equilibrium price and equilibrium quantity of a commodity affected by a rise in the prices of its substitutes explain with diagram?1 Answer. A rise in price of substitues leads to an increase in the demand for the commodity. Hence, the demand curve will shift rightwards. With this increase in demand and supply being the same, equilibrium price will rise with an increase in competition among buyers.
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