If a price is below the equilibrium price in a competitive market, then the market will push the price ________ and the quantity supplied ________.

Up; down

Down; up

Down; down

No change; no change

1 answer

If a price is below the equilibrium price in a competitive market, then the market will push the price up and the quantity supplied up.

This happens because at a price below equilibrium, the quantity demanded exceeds the quantity supplied, creating a shortage. To eliminate this shortage, producers will raise their prices, and as prices rise, suppliers are incentivized to increase the quantity they are willing to supply.

So the correct answer is: Up; up.