1. Shifts in both
Supply and Demand
What happens to Price
and what happens to
Quantity?

2. Increase in demand Increase in supply P S S P1 Quantity
will definitely
increase. P1 P D1
Price is
Indeterminate D
It will either
go up. Q Q1 Q1 Q
Increase in demand
Increase in supply

3. Increase in demand Increase in supply P S S P1 Quantity
will definitely
increase. P1 P D1
Price is
Indeterminate D
It stayed the
same. Q Q1 Q1
Increase in demand
Increase in supply

4. Increase in demand Increase in supply P S P1 Quantity will definitely
Price is
Indeterminate D
It went down. Q Q1 Q1
Increase in demand
Increase in supply

5. What happens to the price and quantity if there
is an increase in demand and a decrease in supply?
Price definitely goes up; Quantity is indeterminate

6. What happens to the price and quantity if there
is a decrease in demand and an increase in supply?
Price definitely goes down; Quantity is indeterminate

7. What happens to the price and quantity if there
is a decrease in demand and an decrease in supply?
Price is indeterminate; Quantity will definitely decrease