Which of the following best describes the sequences of events that lead to a price increase and quantity decrease when supply decreases? When supply decreases, there is a surplus because Qs > Qd at the old price. Price will adjust upward until the market clears at a new lower quantity. When supply decreases, there is a shortage because Qs < Qd at the old price. Price will adjust upward until the market clears at a new lower quantity. When supply decreases, there is a shortage because Qs > Qd at the old price. Price will adjust upward until the market clears at a new lower quantity. When supply decreases, there is a surplus because Qs < Qd at the old price. Price will adjust upward until the market clears at a new lower quantity.
Which of the following best describes the sequences of events that lead to a price increase and quantity decrease when supply decreases? When supply decreases, there is a surplus because Qs > Qd at the old price. Price will adjust upward until the market clears at a new lower quantity. When supply decreases, there is a shortage because Qs < Qd at the old price. Price will adjust upward until the market clears at a new lower quantity. When supply decreases, there is a shortage because Qs > Qd at the old price. Price will adjust upward until the market clears at a new lower quantity. When supply decreases, there is a surplus because Qs < Qd at the old price. Price will adjust upward until the market clears at a new lower quantity.
Managerial Economics: A Problem Solving Approach
5th Edition
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Chapter8: Understanding Markets And Industry Changes
Section: Chapter Questions
Problem 2MC
Related questions
Question
Which of the following best describes the sequences of events that lead to a price increase and quantity decrease when supply decreases?
- When supply decreases, there is a surplus because Qs > Qd at the old price. Price will adjust upward until the market clears at a new lower quantity.
- When supply decreases, there is a shortage because Qs < Qd at the old price. Price will adjust upward until the market clears at a new lower quantity.
- When supply decreases, there is a shortage because Qs > Qd at the old price. Price will adjust upward until the market clears at a new lower quantity.
- When supply decreases, there is a surplus because Qs < Qd at the old price. Price will adjust upward until the market clears at a new lower quantity.
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
![Managerial Economics: A Problem Solving Approach](https://www.bartleby.com/isbn_cover_images/9781337106665/9781337106665_smallCoverImage.gif)
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
![Microeconomics](https://www.bartleby.com/isbn_cover_images/9781337617406/9781337617406_smallCoverImage.gif)
![Macroeconomics](https://www.bartleby.com/isbn_cover_images/9781337617390/9781337617390_smallCoverImage.gif)
![Managerial Economics: A Problem Solving Approach](https://www.bartleby.com/isbn_cover_images/9781337106665/9781337106665_smallCoverImage.gif)
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
![Microeconomics](https://www.bartleby.com/isbn_cover_images/9781337617406/9781337617406_smallCoverImage.gif)
![Macroeconomics](https://www.bartleby.com/isbn_cover_images/9781337617390/9781337617390_smallCoverImage.gif)
![Economics (MindTap Course List)](https://www.bartleby.com/isbn_cover_images/9781337617383/9781337617383_smallCoverImage.gif)
Economics (MindTap Course List)
Economics
ISBN:
9781337617383
Author:
Roger A. Arnold
Publisher:
Cengage Learning
![Economics For Today](https://www.bartleby.com/isbn_cover_images/9781337613040/9781337613040_smallCoverImage.gif)
![Survey Of Economics](https://www.bartleby.com/isbn_cover_images/9781337111522/9781337111522_smallCoverImage.gif)