suppose that the supply of oil and the demand for oil both decrease next year and that the decrease in…
suppose that the supply of oil and the demand for oil both decrease next year and that the decrease in supply is less than the decrease in demand. what will happen to the equilibrium price? there is not enough information to determine what will happen to the equilibrium price of oil. it will fall. it will stay the same. it will rise.
Answer
Brief Explanations:
When both supply and demand decrease, and the decrease in demand is greater than the decrease in supply, the demand - curve shifts leftward by a larger amount than the supply - curve. This leads to a new equilibrium at a lower price and lower quantity.
Answer:
It will fall.