Other things being equal, an increase in supply will lead to
A. a fall in price and an increase in quantity bought and sold B. an increase in price and increase in quantity bought and sold C. a fall in price and a fall in quantity bought and sold D. an increase in quantity supplied and demanded only
Correct Answer: A
Explanation
A change in supply will cause equilibrium price and output to change inopposite directions. a. An increase in supply will cause a reduction in the equilibrium price and an inase in the equilibrium quantity of a good.
