If the Demand Curve in a Constant Cost Market Shifts

question 81

Multiple Choice

If the demand curve in a constant cost market shifts down and to the left, then:

• A)the long run price and quantity decrease.
• B)the long run price stays the same and the long run quantity decreases.
• C)the long run price decreases and the long run quantity stays the same.
• D)the long run price and quantity increase.

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Definitions:

Market Rate

The prevailing rate of interest or return available on investments, often referred to in the context of loans or savings.

Capital Loss

The loss incurred when the selling price of an asset is less than the purchase price, reflecting a decrease in the value of the asset.

Put Bond

A type of bond that allows the holder to force the issuer to buy back the bond at specified times before maturity.

Deferred Call Provision

A clause in a bond contract that prohibits the issuer from repurchasing the bond until a specified date has passed.