Learning Path
Question & Answer1
Understand Question2
Review Options3
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Explore TopicChoose the Best Answer
A
True
B
False
Understanding the Answer
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Answer
When demand for a product increases, more people want to buy it, which usually pushes the price up. At the same time, if supply decreases, there are fewer products available for sale. This combination means that sellers can charge higher prices because there are more buyers than products available. However, it’s unclear how much the quantity sold will change because it depends on how much demand increases compared to how much supply decreases. For example, if a new video game becomes very popular (increased demand) but fewer copies are available (decreased supply), the price will go up, but we can't say for sure if more or fewer games will be sold overall.
Detailed Explanation
When more people want a product but there are fewer available, prices go up. Other options are incorrect because Some might think that the quantity will also change in a clear way.
Key Concepts
Market Equilibrium
Demand and Supply Shifts
Price Elasticity
Topic
Analyzing Market Equilibrium Changes
Difficulty
easy level question
Cognitive Level
understand
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