Several advertisements announce that the price of hand sanitizer will be decreasing next month. At the same time, the price of rubbing alcohol, an ingredient used to make hand sanitizer, has increased. Given these two effects, what can we say about the current equilibrium price and quantity of hand sanitizer? O Equilibrium price will decrease; the effect on quantity is ambiguous. O Equilibrium price will increase, equilibrium quantity will decrease. O Equilibrium quantity will decrease; the effect on price is ambiguous. O Equilibrium quantity will increase; the effect on price is ambiguous.

Several advertisements announce that the price of hand sanitizer will be decreasing next month. At the same time, the price of rubbing alcohol, an ingredient used to make hand sanitizer, has increased. Given these two effects, what can we say about the current equilibrium price and quantity of hand sanitizer? O Equilibrium price will decrease; the effect on quantity is ambiguous. O Equilibrium price will increase, equilibrium quantity will decrease. O Equilibrium quantity will decrease; the effect on price is ambiguous. O Equilibrium quantity will increase; the effect on price is ambiguous.

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter4: The Market Forces Of Supply And Demand

Section: Chapter Questions

Problem 8PA

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