Simultaneous changes in Demand and Supply

2.5 Simultaneous Changes in D and S

· Shifts in the same direction

· à in DD and à in SS

· ß in DD and ß in SS

· Shifts in the opposite direction

· à in DD andß in SS

· ß in DD and à in SS

Price is indeterminate

There will always be an increase in equilibrium quantity.!!!!!

Increase DD and SS always increases Qe but Pe in indeterminate.

Do these yourself

· Draw a diagram to explain what happens when there is a simultaneous….

· Increase in DD and decrease in SS; and….