Review statement-demand increases causing prices to rise


Question: The following two sets of statements contain common errors. Identify and explain each.

A) Demand increases, causing prices to rise. Higher prices cause demand to fall. Therefore, prices fall back to their original levels.

B) The supply of meat in France increases, causing meat prices to fall. Lower prices always mean that French households spend more on meat.

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Microeconomics: Review statement-demand increases causing prices to rise
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