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Question
What would happen to the price and quantity of medical services if an existing doctors office closed in a small town, ceteris paribus?
a. Equilibrium price and quantity would rise because both supply and demand increased.
b. Equilibrium price and quantity would fall because both supply and demand decreased.
c. Equilibrium price would rise and quantity would fall because supply decreased and demand was constant.
d. Equilibrium price and quantity would rise because demand decreased while supply was constant.
e. Equilibrium price and quantity would fall because demand decreased and supply was constant.
Answer
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