Assume the Demand for Product Y Increases and the Subsequent

question 87

Multiple Choice

Assume the demand for product Y increases and the subsequent market system responses result in the production of more Y.This illustrates:

• A)that the concept of derived demand is inapplicable.
• B)that consumer sovereignty is inoperative in this economy.
• C)the scarcity function of prices.
• D)the directing or guiding function of prices.

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Definitions:

Stockholders' Equity

The ownership claim on a corporation's assets that remains after all liabilities are accounted for, denoting shareholder interest.

Current Assets

Short-term assets that are expected to be converted into cash within one year or within the operating cycle of a business.

Interest Expense

The cost incurred by an entity for borrowed funds, which is charged as an expense on the income statement.