passwella.
Menu

JAMB Economics 2012 Question 19

Question 19

Price Determination

Fixing price above equilibrium will cause

  1. A.demand and supply to remain constant
  2. B.an increase in quantity supplied
  3. C.an increase in supply
  4. D.a decrease in quantity supplied.
Show the answer and explanation

Answer: B (an increase in quantity supplied)

Explanation

At a price above equilibrium, producers are willing to sell more, so quantity supplied rises (a movement along the supply curve).