Show Recommended textbook solutions Principles of Microeconomics7th EditionN. Gregory Mankiw 830 solutions Principles of Microeconomics8th EditionN. Gregory Mankiw 796 solutions Microeconomics21st EditionCampbell R. McConnell, Sean M. Flynn, Stanley L. Brue 653 solutions Microeconomics21st EditionCampbell R. McConnell, Sean M. Flynn, Stanley L. Brue 653 solutions What happens when the price of something increases?An increase in price almost always leads to an increase in the quantity supplied of that good or service, while a decrease in price will decrease the quantity supplied.
What would happen if a seller raised the price of an item at a time when there was a market surplus?Once you raise the price of your product, your product's quantity demanded will drop until equilibrium is reached. Therefore, shortage drives price up. If a surplus exist, price must fall in order to entice additional quantity demanded and reduce quantity supplied until the surplus is eliminated.
Why do firms supply more at higher prices?Key Takeaways. The law of supply says that a higher price will induce producers to supply a higher quantity to the market. Because businesses seek to increase revenue, when they expect to receive a higher price for something, they will produce more of it.
Which of the following events would result in an increase in equilibrium price?An increase in demand and a decrease in supply will cause an increase in equilibrium price, but the effect on equilibrium quantity cannot be detennined. 1. For any quantity, consumers now place a higher value on the good,and producers must have a higher price in order to supply the good; therefore, price will increase.
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What will occur if a firm expects that the price of its product will be higher in the future than it is today?
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