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Question
Briefly discuss how is new equilibrium established when demand of supply curve happens to shift.
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Solution
Case 1) when demand curve shift to the right the equilibrium quantity and price both rise and when it shifts to the left both equilibrium quantity and price tend to fall. Case 2) When supply curve shifts to the right the equilibrium price falls down and equilibrium quantity increases whereas when it shifts to the left, equilibrium price increases and quantity falls.
Case 1) when demand curve shift to the right the equilibrium quantity and price both rise and when it shifts to the left both equilibrium quantity and price tend to fall.
Case 2) When supply curve shifts to the right the equilibrium price falls down and equilibrium quantity increases whereas when it shifts to the left, equilibrium price increases and quantity falls.
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