Question

When the demand curve shifts to the​ right, A. the equilibrium price will decrease and the equilibrium quantity will increase. B. the equilibrium price will increase and the equilibrium quantity will decrease. C. the equilibrium price and quantity will both increase. D. the equilibrium price and quantity will both decrease.

Answer 1

The correct answer is option C.

Step-by-step explanation:

A rightward shift in the demand curve means that at the same price levels, the consumers are demanding more of the commodity. A rightward shift in the demand curve causes it to intersect with the supply curve at a higher point.

The equilibrium point shifts upward. This causes both equilibrium quantity and price level to increase.

A leftward shift, on the other hand, causes the equilibrium price and quantity to decrease.