refer to the information provided in the figure at right to answer the question that follows. the current…

refer to the information provided in the figure at right to answer the question that follows. the current price of a bag of pretzels is $1.10. you accurately predict that in this market\n\na. price and quantity supplied decrease and quantity demanded increases.\nb. price tends to remain constant and quantity supplied increases.\nc. price, quantity demanded, and quantity supplied decrease.\nd. price and quantity demanded increase and quantity supplied decreases.

refer to the information provided in the figure at right to answer the question that follows. the current price of a bag of pretzels is $1.10. you accurately predict that in this market\n\na. price and quantity supplied decrease and quantity demanded increases.\nb. price tends to remain constant and quantity supplied increases.\nc. price, quantity demanded, and quantity supplied decrease.\nd. price and quantity demanded increase and quantity supplied decreases.

Answer

Brief Explanations:

In a market, when the current price is below the equilibrium price (as can be inferred from the graph where quantity demanded exceeds quantity supplied at the price of $1.10), there is a shortage. To reach equilibrium, price and quantity demanded will increase as the price rises to attract more supply, and quantity supplied will decrease as the price - quantity relationship adjusts.

Answer:

D. price and quantity demanded increase and quantity supplied decreases