Answer the following question briefly:
With the help of the diagram, show how the equilibrium price and quantity of a commodity are affected when:
Supply is perfectly elastic and demand increases.

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Solution

When supply is perfectly elastic and demand increases the equilibrium price remains unaffected but the equilibrium quantity level rises.

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Answer the following question briefly:With the help of the diagram, show how the equilibrium price and quantity of a commodity are affected when:Supply is perfectly elastic and demand increases.

When supply is perfectly elastic and demand increases the equilibrium price remains unaffected but the equilibrium quantity level rises.

Answer the following question briefly:
With the help of the diagram, show how the equilibrium price and quantity of a commodity are affected when:
Supply is perfectly elastic and demand increases.