if the demand and supply curves increase (shift outward) by identical proportions then\na. equilibrium price…

if the demand and supply curves increase (shift outward) by identical proportions then\na. equilibrium price stays the same and quantity rises.\nb. equilibrium price and quantity do not change.\nc. equilibrium price and quantity both increase.\nd. equilibrium price increases but quantity falls.\nwhat if the increase in demand were larger than the increase in supply?\na. the equilibrium price decreases and the quantity increases.\nb. the equilibrium price and quantity increase.\nc. the equilibrium price increases and the quantity decreases.\nd. the equilibrium price and quantity decrease.

if the demand and supply curves increase (shift outward) by identical proportions then\na. equilibrium price stays the same and quantity rises.\nb. equilibrium price and quantity do not change.\nc. equilibrium price and quantity both increase.\nd. equilibrium price increases but quantity falls.\nwhat if the increase in demand were larger than the increase in supply?\na. the equilibrium price decreases and the quantity increases.\nb. the equilibrium price and quantity increase.\nc. the equilibrium price increases and the quantity decreases.\nd. the equilibrium price and quantity decrease.

Answer

Brief Explanations:

  1. When demand and supply curves increase by identical proportions, the new equilibrium is found by considering the shift. The increase in demand pushes the price - quantity combination up and to the right, while the increase in supply pushes it down and to the right. Since the shifts are in equal proportions, the upward and downward pressure on price cancel out, and the quantity increases.
  2. When the increase in demand is larger than the increase in supply, the right - ward shift of the demand curve is greater than that of the supply curve. This leads to an increase in both the equilibrium price and the equilibrium quantity as the new intersection point of the demand and supply curves is at a higher price and quantity level.

Answer:

  1. A. equilibrium price stays the same and quantity rises.
  2. B. The equilibrium price and quantity increase.