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Price S S2 P* D D2 QuantityThe overall effect of these shifts, then, without any further information, is a decrease in equilibrium price and an
Price S S2 P* D D2 QuantityThe overall effect of these shifts, then, without any further information, is a decrease in equilibrium price and an ambiguous change in equilibrium quantity. Now, let's say we have more information so that we can graph these shifts. You can see them to your right. After both shifts occur, now that we have the graph, what can we say happens to equilibrium price and quantity?Equilibrium price falls and equilibrium quantity rises. Equilibrium price falls, but the change in equilibrium quantity is ambiguous
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