If We Observe a Rise in the Equilibrium Price of Good

question 13

Multiple Choice

If we observe a rise in the equilibrium price of good A, we know that the demand for A has

• A)increased or the supply of A has increased or both.
• B)decreased or the supply of A has increased or both.
• C)decreased or the supply of A has decreased or both.
• D)increased or the supply of A has decreased or both.
• E)not changed.

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Definitions:

Consumer Demand Curve

illustrates the relationship between the price of a good or service and the quantity demanded by consumers over a period, typically showing an inverse relationship.

Diminishing Marginal Utility

The principle that says the additional satisfaction a consumer gains from consuming one more unit of a good or service will lessen with each additional unit consumed.

Marginal Utility

Marginal utility is the additional satisfaction or utility that a consumer derives from consuming one more unit of a good or service.

Marginal Utility

This term refers to the additional satisfaction or utility gained by consuming one more unit of a good or service.