Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
Price increases, quantity increases
B
Price decreases, quantity decreases
C
Price increases, quantity decreases
D
Price remains the same, quantity decreases
Understanding the Answer
Let's break down why this is correct
Answer
When there is an increase in demand for a product while the supply stays the same, the market equilibrium price and quantity will change. Demand means how much people want to buy, and if more people want a product, they are willing to pay more for it. This increased demand pushes the price up because sellers see that they can charge more. As a result, the quantity sold also increases, but only up to a point where the supply can meet the higher demand. For example, if more people want to buy ice cream on a hot day, the price of ice cream might go up, and ice cream shops will sell more cones until they run out or until fewer people want to buy at that higher price.
Detailed Explanation
When more people want to buy a product, the price goes up. Other options are incorrect because Some might think that if demand goes up, prices should drop; It's a common mistake to think that higher prices mean less quantity.
Key Concepts
market equilibrium
Topic
Analyzing Market Equilibrium Changes
Difficulty
easy level question
Cognitive Level
understand
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