Microeconomics: Principles, Applications, and Tools (8th Edition)

by O'Sullivan, Arthur; Sheffrin, Steven; Perez, Stephen

Published by Prentice Hall

ISBN 10: 0-13294-886-9

ISBN 13: 978-0-13294-886-9

Chapter 4 - Demand, Supply, and Market Equilibrium - Exercises - 4.5 Market Effects of Changes in Supply - Page 94: 5.9

Answer

Equilibrium price will increase and quantity will decrease.

Work Step by Step

The reduction in supply will shift the supply curve up, resulting in a higher equilibrium price and a lower equilibrium quantity.

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