Ceteris paribus, a decrease in supply will lead to
Understand the Problem
The question is asking about the economic principle of supply and demand, specifically how a decrease in supply (ceteris paribus) affects price and quantity. We will analyze the effects of a decrease in supply on market prices and quantities.
Answer
Increased price; decreased quantity.
The final answer is an increase in price and a decrease in quantity.
Answer for screen readers
The final answer is an increase in price and a decrease in quantity.
More Information
When supply decreases, the supply curve shifts left, generally leading to higher prices due to reduced availability, and fewer transactions, reducing quantity.
Tips
Confusing supply and demand curves can lead to mistakes; ensure the correct curve is being considered when making deductions.
Sources
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