Identify the flaw in this analysis: “If more Americans go on low-carb diet, the demand for bread will fall. The decrease in the demand of bread will cause the price of bread to fall, The lower price, however will then increase the demand. In the new equilibrium, Americans might end up consuming more bread than they did initially.”
Identify the flaw in this analysis: “If more Americans go on low-carb diet, the demand for bread will fall. The decrease in the demand of bread will cause the price of bread to fall, The lower price, however will then increase the demand. In the new equilibrium, Americans might end up consuming more bread than they did initially.”
Demand is a concept that refers to the desire of a consumer to buy services and goods and the willingness to pay a price for a particular product or service. Holding all other variables unchanged, the quantity demanded would be decreased by a rise in the price of a good or service and vice versa.
Supply is a term that describes the total quantity available to consumers of a specific service or goods. Supply is the amount available at a particular price or to the amount available across a range of prices.
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