2.4 Changes in Demand/Supply and Their Effects on Equilibrium

The four one-shift cases (learn the table, then the logic: which curve moved, which variable isambiguous):ShiftEquilibrium priceEquilibrium quantityDemand increases (→)risesrisesDemand decreases (←)fallsfallsSupply increases (→)fallsrisesSupply decreases (←)risesfallsLogic: demand shifts move price and quantity together; supply shifts move them oppositely.Simultaneous shifts (the higher-order answer):• Both increase: quantity surely rises; price ambiguous (indeterminate without magnitudes);• Both decrease: quantity surely falls; price ambiguous;• Demand up + supply down: price surely rises; quantity ambiguous;• Demand down + supply up: price surely falls; quantity ambiguous. Rule to memorise:whenboth curves shift, one variable is always indeterminate — say which, and why.Nepali illustrations (one per case): demand up (festival season — goat prices and quantity both jump); supply down (monsoon failure — vegetable prices rise, quantity falls); demand down (post-2015 tourist cancellations — hotel rates collapsed); simultaneous (COVID-19: remittance- funded demand down and disrupted supply up-in-cost — prices could go either way, and did, good by good).