With a given supply curve, a decrease in demand causes -

An overall decrease in price but an increase in equilibrium quantity.

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An overall increase in price but a decrease in equilibrium quantity.

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An overall decrease in price and a decrease in equilibrium quantity.

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No change in overall price but a reduction in equilibrium quantity.

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Solution

The correct option is D An overall decrease in price and a decrease in equilibrium quantity.
An increase in demand causes the equilibrium price to rise. On the other hand, a decrease in demand causes the equilibrium price to fall. An increase in supply causes the equilibrium price to fall, while a decrease in supply causes the equilibrium price to rise

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