Why Does Quantity Supplied Increase When Price Increases

question 263

Multiple Choice

Why does quantity supplied increase when price increases?

• A)Producers find it more profitable to make the item.
• B)People "drop out" of the market, so buyers find it more abundant.
• C)As demand decreases with a high price, surpluses appear.
• D)All of the above.

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Definitions:

Failed Banks

Financial institutions that have been unable to meet their obligations, leading to closure or takeover by a regulatory agency.

Fiat Money

Currency that a government has declared to be legal tender, despite it having no intrinsic value or being backed by a physical commodity.

Liability

A legal financial obligation or debt that an entity owes to another entity, required to be settled through the transfer of assets, provision of services, or other financial settlement.

Federal Reserve Note

The official paper currency of the United States, issued by the Federal Reserve, and the most common form of U.S. banknotes in circulation.