ECON 1 Chapter Notes - Chapter 7: Economic Equilibrium, Demand Curve
Document Summary
How equilibrium price and quantity are affected when there is a change in either supply or demand. How equilibrium price and quantity are affected when there is a simultaneous change in both supply and demand. An increase in demand is indicated by a rightward shift of the demand curve from d1 to. To get back to equilibrium, there has to be an upward movement along the supply curve. A decrease in demand is indicated by a leftward shift of the demand curve. To get back to equilibrium, there has to be a downward movement along the supply curve. When demand for a good or service decreases, the equilibrium price and the equilibrium quantity of the good or service both fall. When supply of a good or service decreases, the equilibrium price of the good or service rises and the equilibrium quantity of the good or service falls.
