an increase in the demand for rice and an increase in the supply of rice occur together. what is the effect…

an increase in the demand for rice and an increase in the supply of rice occur together. what is the effect on the price and quantity of rice? an increase in the demand for rice together with an increase in the supply of rice ______ create a surplus or a shortage of rice at the original price. the equilibrium price of rice ______. a. will not; will not change b. might; will rise c. might; might fall, rise, or not change d. will not; will fall the equilibrium quantity of rice ______. a. increases or decreases but we dont know for sure b. increases c. decreases d. increases if the price rises and decreases if the price falls

an increase in the demand for rice and an increase in the supply of rice occur together. what is the effect on the price and quantity of rice? an increase in the demand for rice together with an increase in the supply of rice ______ create a surplus or a shortage of rice at the original price. the equilibrium price of rice ______. a. will not; will not change b. might; will rise c. might; might fall, rise, or not change d. will not; will fall the equilibrium quantity of rice ______. a. increases or decreases but we dont know for sure b. increases c. decreases d. increases if the price rises and decreases if the price falls

Answer

Brief Explanations:

When demand and supply both increase, at the original price, there could be a surplus or shortage depending on the magnitudes of the shifts. If the increase in supply is relatively larger than the increase in demand, there might be a surplus; if the increase in demand is relatively larger, there might be a shortage. For the equilibrium price, it depends on the relative sizes of the changes in demand and supply. If the increase in supply is greater, price may fall; if the increase in demand is greater, price may rise; if they are equal in magnitude, price may not change. The equilibrium quantity will always increase because both the demand - side and supply - side factors are pushing for more quantity to be transacted in the market.

Answer:

  1. C. might; might fall, rise, or not change
  2. B. increases