Supply and demand curve multioption

The new equilibrium price is higher and the new equilibrium quantity is indeterminate. When supply decreases, this leads to a decrease in the equilibrium quantity. Conversely, when demand increases, this leads to an increase in the equilibrium quantity, so the two shifts occurring at the same time mean that the new equilibrium quantity could be higher or lower depending on the magnitude of the shifts, as seen on the graphs. However, a decrease in supply and an increase in demand both cause the equilibrium price to increase and therefore, regardless of the magnitude of the shifts, the new equilibrium price will be higher.

Consider the market for honey. What happens?

Parasites are causing huge declines in bee colonies around the U.S. Meanwhile, "hot honey," honey with a kick, gains lots of popularity in the South.

The new equilibrium price is indeterminate and the new equilibrium quantity is higher. When supply increases, this leads to a decrease in the equilibrium price. Conversely, when demand increases, this leads to an increase in the equilibrium price, so the two shifts occurring at the same time mean that the equilibrium price could be higher or lower depending on the magnitudes of the shifts, as seen in the graphs. However, an increase in supply and an increase in demand both cause the equilibrium quantity to increase, and therefore, regardless of the magnitudes of the shifts, the new equilibrium quantity will be higher.

Consider the market for hand sanitizer. What happens?

At the beginning of the COVID-19 pandemic, individuals become more concerned with hand sanitizing. Several alcohol distilleries decide to shift production from alcohol to hand sanitizer.

The new equilibrium price is indeterminate and the new equilibrium quantity is lower. When supply decreases, this leads to an increase in the equilibrium price. Conversely, when demand decreases, this leads to a decrease in the equilibrium price, so the two shifts occurring at the same time mean that the new equilibrium price is indeterminate: it could be higher or lower depending on which shift is larger, as seen on the graphs. However, a decrease in supply and a decrease in demand both cause the equilibrium quantity to decrease, and therefore, regardless of the magnitudes of the shifts, the new equilibrium quantity will be lower.

Consider the market for ridesharing services. What happens?

During the COVID-19 pandemic, both ridesharing drivers and passengers are worried about traveling in a car with strangers and reduce the number of trips they take.

The new equilibrium price is lower and the new equilibrium quantity is higher. When supply increases, this leads to a lower equilibrium price and a higher equilibrium quantity.

Consider the market for internet services. What happens?

Several new internet service providers enter the market. Meanwhile, new satellites lower the cost of providing internet service.

Consider the market for hula hoops. What happens?

Hula hoops are hailed on TikTok as the latest, greatest weight loss device. Meanwhile, all stores that import plastic toys into the U.S. must pay a new tariff.

The new equilibrium price is indeterminate and the new equilibrium quantity is lower. When supply decreases, this leads to an increase in the equilibrium price. Conversely, when demand decreases, this leads to a decrease in the equilibrium price, so the two shifts occurring at the same time mean that the new equilibrium price is indeterminate: it could be higher or lower depending on which shift is larger, as seen in the featured graphs. However, a decrease in supply and a decrease in demand both cause the equilibrium quantity to decrease, and therefore, regardless of the magnitudes of the shifts, the new equilibrium quantity will be lower.

Consider the market for earbuds. What happens?

Consumers expect that a superior type of wireless earbuds will launch in six months

The new equilibrium price and quantity are both lower. When demand decreases, this leads to a lower equilibrium price and quantity.

Consider the market for eyeglasses. What happens?

The price of laser eye surgeries that reduce the need to wear glasses falls dramatically. Meanwhile, new technology lowers the costs to produce eye contacts, a substitute for eyeglasses.

Consider the market for gyms. What happens?

A celebrity suffers from a bacterial infection contracted while working out a gym. Meanwhile, a new exercise craze focusing on outdoor workouts sweeps the nation.

The new equilibrium price is indeterminate and the new equilibrium quantity is higher. When supply increases, this leads to a decrease in the equilibrium price. Conversely, when demand increases, this leads to an increase in the equilibrium price, so the two shifts occurring at the same time mean that the equilibrium price could be higher or lower depending on the magnitudes of the shifts, as seen on the graphs. However, an increase in supply and an increase in demand both cause the equilibrium quantity to increase, and therefore, regardless of the magnitudes of the shifts, the new equilibrium quantity will be higher.

A new baby boom takes place in the U.S. At the same time, the government starts subsidizing daycare centers.
&nbsp;
Consider the market for daycare centers. What happens?