Microeconomics

"An increase in the demand for notebooks raises the quantity of notebooks demanded, but not the quantity supplied."

True or False? Explain.

3 Answers

Rating
  • Danny
    Lv 6
    1 decade ago
    Favorite 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 6
    1 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.

  • Anonymous
    1 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.

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