If the market is in equilibrium and demand shifts to the right, what happens to the equilibrium price and quantity?

• A. Equilibrium price falls and quantity falls
• B. Equilibrium price rises and quantity falls
• C. Equilibrium price rises and quantity rises
• D. Equilibrium price falls and quantity rises

Answer: (C)

When demand increases, the demand curve shifts to the right. With the supply curve unchanged, the new intersection with supply occurs at a higher price. That higher price encourages more production, so the equilibrium quantity rises as well. So the outcome is both price and quantity increasing.

The other patterns would come from different shifts: for example, a rise in price with a fall in quantity would imply a decrease in demand or a leftward shift in supply, not a simple rightward shift in demand.