Question

The supply and demand curves for a market are graphed below with price in dollars and quantity in thousands.

A line graph shows supply (S) and demand (D) curves intersecting.

The horizontal axis represents quantity and ranges from 0 to 70, in increments of 10 units. The vertical axis represents price and ranges from 0 to 50, in increments of 10 units. An upward-sloping line labeled "S" represents the supply curve, and a downward-sloping line labeled "D" represents the demand curve. These two curves intersect at a point where the price is marked $30 and the quantity is marked approximately 33 units. A dashed horizontal line extends from the point of intersection to the vertical axis.
Which of the following would result from an increase (shift in the right) in the supply curve?

(1 point)

a market equilibrium quantity greater than $30


a market equilibrium price less than $30


a market equilibrium price greater than $30


a market equilibrium quantity less than $30

Answer 1

Answer: a market equilibrium price less than $30.

Explanation: A rightward shift in supply increases quantity supplied at each price, so the new equilibrium has a lower price and a higher quantity than before. Thus price falls below $30.