Question

Suppose that a recent celebrity endorsement made more people prefer this brand of cell phones. Now, more cell phones are demanded at each price level. As a result of the increase in demand, the equilibrium price _____ and the equilibrium quantity _____. increases, decreases

Answer 1

As a result of the increase in demand, the equilibrium price increases and the equilibrium quantity decreases.

Step-by-step explanation:

Celebrity Endorsement is an easy and quick way to boost sales of a specific product. People tend to purchase that product. When people purchase that product, the demand of the product increases, so the prices also increase. As a result of the increased demand, the supply is decreased, thus decreases the quantity of the product.

Answer 2

The prices increases and the quantity decreases. This question explains the concept of supply and demand. As demand goes up, the prices go up and supply goes down.