Advertisement Remove all ads

Answer the Following Question. Show with the Help of Diagrams, the Effect on Equilibrium Price and Quantity When: There is a Rise in the Prices of Inputs. - Economics

Advertisement Remove all ads
Advertisement Remove all ads
Short Note

Answer the following question.
Show with the help of diagrams, the effect on equilibrium price and quantity when:
There is a rise in the prices of inputs.

Advertisement Remove all ads

Solution

With a rise in the price of the input, the cost of production will increase and profit will fall. With a fall in profit rate supply will decrease.
A new equilibrium will be established which will be at a higher price, lower quantity demand and lower supply.

Concept: Market Equilibrium
  Is there an error in this question or solution?
Advertisement Remove all ads
Advertisement Remove all ads
Share
Notifications

View all notifications


      Forgot password?
View in app×