Answer is D,please explain 16.17 The demand function lor abalone is q = 30-9p an

Question

Answer is D,please explain

16.17 The demand function lor abalone is q = 30-9p and 1 he supply function is q = 6p. Suddenly the yuppies discover abalone. The quantity demanded at every price dou bles. The supply function, however, remains the same as before. What is the effeet on the equilibrium price and quantity? (a) The price doubles and the qantity remains constan (b) The quantity doubles and the price remains constant. (c) Both price and quantity double. (d) Both price and quantity increase, but neither doubles (e) None of the above.

Explanation / Answer

With response to doubling of demand at every price and supply function remainning the same, the price and quantity both will increase but neither of them will double at new equilibrium point.

Thus the correct option is D.

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