What Is the Graphical Effect of a Decrease in the Prices

question 113

Multiple Choice

What is the graphical effect of a decrease in the prices of factor inputs such as labour and materials?

• A)The SRAC curve would shift down and the LRAC curve would shift up.
• B)The SRAC curve would shift up and the LRAC curve would shift down.
• C)Both the SRAC curve and the LRAC curve would shift up.
• D)Both the SRAC curve and the LRAC curve would shift down.

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Definitions:

Economic Growth

An increase in the production of goods and services in an economy over a period of time, usually measured by GDP.

Private Sector

The part of the economy that is owned and operated by individuals and private companies, as opposed to being controlled by the government.

The Global Sullivan Principles

A set of ethical guidelines designed to promote corporate social responsibility, originally focused on human rights and equality in the workplace.

Universal Human Rights

The inalienable fundamental rights to which all human beings are inherently entitled, regardless of race, nationality, language, religion, or any other status.