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What happens to the equilibrium price when market supply increases?
  • a)
    The equilibrium price decreases.
  • b)
    The equilibrium price remains unchanged.
  • c)
    The equilibrium price increases.
  • d)
    The equilibrium price becomes unpredictable.
Correct answer is option 'A'. Can you explain this answer?
Most Upvoted Answer
What happens to the equilibrium price when market supply increases?a)T...
When market supply increases, the equilibrium price typically decreases. This happens because an increase in supply means there are more goods available in the market. With greater supply and the same level of demand, suppliers may lower prices to encourage consumers to buy more, resulting in a new equilibrium at a lower price.
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What happens to the equilibrium price when market supply increases?a)The equilibrium price decreases.b)The equilibrium price remains unchanged.c)The equilibrium price increases.d)The equilibrium price becomes unpredictable.Correct answer is option 'A'. Can you explain this answer?
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