The Price of a Good Will Fall If

question 93

Multiple Choice

The price of a good will fall if

• A) there is a surplus at the current price.
• B) the current price is less than the equilibrium price.
• C) the quantity demanded exceeds the quantity supplied.
• D) the price of a complement in consumption falls.

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Definitions:

Marginal Product

The addition to total output due to the use of one more unit of a variable input, keeping all other inputs constant.

Profit-maximizing

The process or strategy of adjusting production and prices to achieve the highest possible profit, taking into account costs and market demand.

Marginal Product

The additional output that results from using one more unit of a particular input, holding all other inputs constant.

Wage

The fixed regular payment, typically calculated on an hourly, daily, or piecework basis, made by an employer to an employee, especially to manual or unskilled workers.