The educational concerns regarding pens result in an increase in the demand for pencils and a decrease in the demand for pens. You can illustrate this in the market for pens by shifting the demand curve to the left. Intuitively, this means that, at a given quantity, consumers are willing to pay less for pens; alternatively, at a given price, consumers are willing to buy fewer pens.

As for supply, the increase in the price of an important production input, such as the cost of ink used to make pens, means that it's now more expensive to produce pens. Since an increase in the cost of pen production leads to a decrease in supply, you can illustrate the effect of an increase in the price of ink by shifting the supply curve up and to the left. Intuitively, this means that, at a given quantity, producers are willing to accept a higher price for pens; alternatively, at a given price, producers are willing to produce fewer pens.

Therefore, you should have indicated a negative shift in demand and a negative shift in supply for both scenarios.

Regardless of the magnitudes of the shifts, when both the demand and supply curves decrease, the equilibrium quantity of pens must decrease. However, you cannot determine the change in the equilibrium price of pens without more information about the relative magnitudes of the shifts.

A decrease in the supply curve puts upward pressure on price, but a decrease in the demand curve puts downward pressure on price. In the first scenario, the magnitude of the supply shift is greater than that of demand, so the upward pressure on price must overpower the downward pressure on price, causing the equilibrium price to increase in this case. In the second scenario, the magnitude of the demand shift is greater than that of supply, so the downward pressure on price must overpower the upward pressure on price, causing the equilibrium price to decrease.

The lesson here is to be careful when drawing conclusions about changes in the equilibrium outcome when both demand and supply change at the same time. Depending on how large the shifts are relative to one another, changes in the equilibrium price or quantity will differ. The following table illustrates the effects of shifts in demand or supply on the equilibrium price and quantity when the magnitudes of the shifts are unknown:

It's also possible for the undetermined equilibrium object not to change at all. If the magnitudes of the two shifts are equal, then the undetermined equilibrium object will remain constant.

As you can see on each of the previous graphs, the curve that shifts by the larger magnitude determines the effect on price in this case. If the supply curve shifts by a larger magnitude than the demand curve, the upward pressure on price that results from a decrease in supply overpowers the downward pressure on price that results from a decrease in demand. On the other hand, if the demand curve shifts with a larger magnitude than the supply curve, the downward pressure on price that results from a decrease in demand overpowers the upward pressure on price that results from a decrease in supply.