A rise in the supply of a commodity cause__________
ECONOMICS
JAMB 2019
A rise in the supply of a commodity cause__________
- A. an increase in the equilibrium price and decrease in the equilibrium quantity bought and sold
- B. an increase in both equilibrium
- C. a decrease in the equilibrium price and an increase in the equilibrium quantity bought and sold
- D. a decrease in both equilibrium
Correct Answer: C. a decrease in the equilibrium price and an increase in the equilibrium quantity bought and sold
Explanation
If supply increase while the demand remains constant, there will be an excess supply over demand which will lead to a decrease in the equilibrium price and an increase in equilibrium quantity.
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