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Questions
When will an increase in demand lead to an increase in price but no change in the quantity supplied?
When does the equilibrium quantity in a market remain unchanged with a change in demand? Show it with the help of a diagram.
Very Short Answer
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Solution
When the supply curve is perfectly inelastic, a change in demand (increase or decrease) brings about a change in equilibrium price, but the equilibrium quantity remains the same (OM). This is illustrated in the given Fig.
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