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nuuo เว EEENS (a) increase price and decreáse thequantityexchanged (b) decreaseprice andincrease the quantityexcchanged (c) increase price and affect the quantity exchanged in an indeterminate way (d) affect price in an indeterminate way and decrease the quantity exchanged 20. A decrease in supply and a decrease in demand will (a) increase price and increase the quantity exchanged o) decreaseprice and decrease the quantityexchanged 21. An increase in demand and a decrease in supply will
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Answer #1

20.

Correct Answer:

D

A simultaneous decrease in demand and supply, will cause quantity to decrease at new equilibrium.

But, change in price will depend upon the volume of change in demand and supply. Here, price will decrease if decrease in demand is more than the decrease in supply. Otherwise, price will increase if decrease in supply is more than the decrease in demand . If both change in equal proportions, then price will be unchanged at the new equilibrium.

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