"An increase in the demand for notebooks raises the quantity of notebooks demanded, but not the quantity supplied."
True or False? Explain.
- DannyLv 61 decade agoFavorite Answer
False. In equilibrium, quantity demanded equals quantity supplied equals quantity transaction. An increase in demand will raise the quantities demanded at all prices. Supply schedule is unaffected, i.e. quantities supplied is unchanged at EACH PRICE. However, the rise in demand will induce a price rise as well as a rise in quantity transacted. Since price is higher, there is a upward movement along the SAME supply curve, so quantity supplied rises with quantity transacted as well.
- 俊浩Lv 61 decade ago
False, increase in demand will shift the demand curve to the right. Both the quantity and price will increase and it will create a new equilibrium price.
- Anonymous1 decade ago
Yes. Just because many people want to buy notebooks, doesn't mean the
manufacturers will make more notebooks. However, if this is a sustained
trends, computer manufacturers will start making more, and increase supply.