13. Assuming a stationary demand curve, what is the effect on equilibrium price P* and quantity Q* of a leftward shift of the supply curve? a. P* decreases; Q* decreases. b. Pincreases; Q* increases. c. P* increases; Q* decreases. d. P* decreases; Q* increases.
13. Assuming a stationary demand curve, what is the effect on equilibrium price P* and quantity Q* of a leftward shift of the supply curve? a. P* decreases; Q* decreases. b. Pincreases; Q* increases. c. P* increases; Q* decreases. d. P* decreases; Q* increases.
Brief Principles of Macroeconomics (MindTap Course List)
8th Edition
ISBN:9781337091985
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter4: The Market Forces Of Supply And Demand
Section: Chapter Questions
Problem 3PA: Consider the market for minivans. For each of the events listed here, identify which of the...
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Transcribed Image Text:13. Assuming a stationary demand curve, what is the effect on equilibrium price P* and quantity Q* of a
leftward shift of the supply curve?
a. P* decreases; Q* decreases.
b. P* increases; Q* increases.
c. P* increases; Q* decreases.
d. P* decreases; Q* increases.
14. The graph below shows supply and demand curve shifts for the propane market. (Propane is used to
heat homes.) Which combination of events would produce the observed shifts in supply and demand and
the resulting effects on market price P* and quantity Q*?
Qº
S₁
a. The supply of propane increases because of more efficient production techniques, and the demand for
propane decreases due to warm winter weather.
b. The supply of propane decreases because of a pipeline explosion, and the demand for propane increases
due to cold winter weather.
c. The supply of propane increases because of more efficient production techniques, and the demand for
propane increases due to cold winter weather.
d. The supply of propane decreases because of a pipeline explosion, and the demand for propane
decreases due to warm winter weather.
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