According to a Supply and Demand Model for Apples,if the Average

question 131

Multiple Choice

According to a supply and demand model for apples,if the average household income decreases at the same time ten apple orchards go out of business,one would expect the:

• A) equilibrium price of apples to increase and the equilibrium quantity of apples in the market to decrease.
• B) equilibrium price of apples to be indeterminate and the equilibrium quantity of apples in the market to increase.
• C) equilibrium quantity of apples in the market to be indeterminate and the equilibrium price of apples to increase.
• D) equilibrium quantity of apples in the market to decrease and the equilibrium price of apples to stay the same.
• E) equilibrium quantity of apples in the market to decrease and the equilibrium price of apples to be indeterminate.

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Definitions:

Operating Expenses

These are costs associated with the day-to-day operations of a business, excluding costs of goods sold, taxes, and interest expenses.

Taking Deposits

The act of receiving funds from customers, under the agreement that the funds will be returned or made available for withdrawal upon the customer's request.

Insurance Companies

Businesses that provide coverage, compensating policyholders for losses in exchange for premiums.

Limited Liability Partnership (LLP)

A limited liability partnership combines the limited liability advantage of a corporation with the tax advantages of a partnership.