In the Context of Fundamental Principles of a Free Market

question 103

Multiple Choice

In the context of fundamental principles of a free market system, which of the following statements is true of a supply curve?

• A) It shows the relationship between price and quantity from a supplier standpoint.
• B) For most goods and services, it forms a sinusoidal curve.
• C) It shows the relationship between supply and quantity from a buyer standpoint.
• D) For most goods and services, it slopes downward as it moves to the right.

---

Definitions:

Pollution Credits

Tradable permits under regulatory systems designed to control and reduce pollution by giving companies a specific allowance for emissions; companies can buy or sell these allowances to meet environmental regulations.

Biodiesel

A renewable, biodegradable fuel made from vegetable oils, animal fats, or recycled restaurant greases for use in diesel engines.

Oil Prices

The cost per barrel of crude oil, influenced by global supply and demand, geopolitical events, and market speculation.

Energy Efficiency

Refers to using less energy to provide the same service or achieve the same level of function.