With a Downward Sloping Demand Curve and an Upward Sloping

question 217

Multiple Choice

With a downward sloping demand curve and an upward sloping supply curve for a product, an increase in incomes will:

• A)increase equilibrium price and quantity if the product is a normal good.
• B)decrease equilibrium price and quantity if the product is a normal good.
• C)have no effect on equilibrium price and quantity.
• D)reduce the quantity demanded, but not shift the demand curve.

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Definitions:

Rate of Default

The probability that a borrower will be unable to make required payments on their debt obligation.

Credit Period

The duration during which a buyer can purchase goods or services on credit before payment is due to the seller, often expressed in days.

Percentage Cost

The cost expressed as a percentage of the purchase price or other value, often used to analyze and compare costs or expenses.

Default Rate

This is the rate at which borrowers fail to make payments on their debts, often expressed as a percentage.