Microeconomics: Principles, Applications, and Tools (8th Edition)

Published by Prentice Hall
ISBN 10: 0-13294-886-9
ISBN 13: 978-0-13294-886-9

Chapter 4 - Demand, Supply, and Market Equilibrium - Exercises - 4.6 Predicting and Explaining Market Changes - Page 95: 6.5

Answer

demand

Work Step by Step

Demand has a positive relationship with both quantity and price. When demand rises, equilibrium prices and quantities rise. Supply has a negative relationship with price. When supply increases, the equilibrium price increases. Supply has a positive relationship with equilibrium quantity. If the equilibrium price and quantity change in the same direction it is because of a change in demand.
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