Refer to the Information Provided in Figure 12

question 51

Multiple Choice

Refer to the information provided in Figure 12.4 below to answer the question(s) that follow. Figure 12.4
There are two sectors in the economy, X and Y, and both are in long-run, zero-profit equilibrium at the intersections of S^{0 and D0.}
-Refer to Figure 12.4. Assume consumer preference changes toward X and away from Y. Ceteris paribus, the equilibrium price of X will ________ and the equilibrium price of Y will ________.

• A) increase; increase
• B) increase; decrease
• C) decrease; increase
• D) decrease; decrease

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Definitions:

World Bank

An international financial institution that provides loans and grants to the governments of low and middle-income countries for the purpose of pursuing capital projects.

Economic Growth

An increase in the production of economic goods and services, compared from one period of time to another.

Developing Countries

Nations with lower levels of industrialization, lower standards of living, and lower Human Development Index ratings compared to developed countries.

International Finance Corporation

A member of the World Bank Group, the IFC focuses on the private sector in developing countries, providing investment, advice, and asset management services to encourage economic development.