The Price of a Good Will Tend to Fall If

question 172

Multiple Choice

The price of a good will tend to fall if

• A)there is a surplus at the current price.
• B)the current price is below the equilibrium price.
• C)the quantity supplied exceeds the quantity demanded at the current price.
• D)Both A and C are true.
• E)None of the above are true.

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Definitions:

Cash Balance

The amount of cash a company has available at any given moment, reflecting its liquidity position.

Merchandise Inventory

Goods that a retail or wholesale company holds for sale to customers in the ordinary course of business.

Budgeted Balance Sheet

A financial statement that projects the financial position of a company at a future date, estimating assets, liabilities, and equity based on anticipated financial activities and plans.

Variable Operating

Refers to operating expenses that vary in direct proportion to changes in an organization's level of activity or volume.