From the position of stable equilibrium, the market supply of a commodity decreases, while the market demand remains unchanged, then:

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Question:

From the position of stable equilibrium, the market supply of a commodity decreases, while the market demand remains unchanged, then:

A.

Equilibrium price falls

B.

Equilibrium quantity rises

C.

Both equilibrium price and equilibrium quantity decreases

D.

Equilibrium price rises, but equilibrium quantity falls

Answer» d. Equilibrium price rises, but equilibrium quantity falls

Note: The above multiple-choice question is for all general and Competitive Exams in India.