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Business, 12.02.2020 03:13 lilmaddy8856
Assume that we are looking at the local market for pizza. Assume that the equilibrium price is $20 and the equilibrium quantity is 1000. Which of the following options best describes what would happen to this market if a study was published that proved that pizza caused serious illness?
1. Supply would decrease causing a surplus situation.
2. Prices would then decline and this causes quantity supplied to increase and quantity demanded to decrease until the new equilibrium is reached at a lower price and lower quantities.
3. Demand would increase causing a surplus situation.
4. Prices would then decline and this causes quantity supplied to increase and quantity demanded to decrease until the new equilibrium is reached at a lower price and higher quantities.
5. Demand would decrease causing a surplus situation.
6. Prices would then decline and this causes quantity supplied to decrease and quantity demanded to increase until the new equilibrium is reached at a lower price and lower
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Answers: 2
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Assume that we are looking at the local market for pizza. Assume that the equilibrium price is $20 a...
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