A decrease in demand lowers the price the most:
In the immediate run
In the short run
When the supply is perfectly elastic
When producers have sufficient time to fully adjust to the demand change
Correct Answer :
A. In the immediate run
Immediate run is a period in which the supply curve is completely inelastic and increase or decrease in supply is impossible in this period. When demand decreases in immediate run then producers due to completely inelastic supply curve cannot decrease the supply so due to decrease in demand while supply is fixed, the supply exceeds the demand and hence in the result price decreases}
Related Questions
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Unit elastic demand in foreign markets
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deniable
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In the immediate run
In the short run
When the supply is perfectly elastic
When producers have sufficient time to fully adjust to the demand change
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Positive
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