Social StudiesQuestion 116 of 120

What generally happens to the price of a good when demand rises but supply stays the same?

a.The price tends to fall
b.The good becomes free
c.The price stays exactly the same
d.The price tends to rise

Explanation

When demand increases while supply is unchanged, competition among buyers usually pushes the price up. This reflects the basic law of supply and demand. Higher demand with limited supply raises prices.

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