Which of the Following Is an Example of a Firm's

question 339

Multiple Choice

Which of the following is an example of a firm's derived demand?

• A)Workers with higher levels of education earn more, on average, than workers with lower levels of education.
• B)Factors that decrease the demand for labor will decrease the equilibrium wage.
• C)A tractor manufacturer's demand for assembly-line workers is inseparably linked to the supply of tractors.
• D)All of the above are correct.

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Definitions:

Equilibrium Quantity

The amount of products or services available and sought after at the equilibrium price, a point where the supply and demand in the market equalize.

Price Ceilings

Government-imposed limits on how high a price can be charged for a product or service.

Market Equilibrium

The condition in which market supply equals market demand, such that prices become stable.

Increased Demand

Describes a situation where a larger number of consumers are willing and able to purchase a good or service at a given price, often leading to higher prices or a market shortage if supply does not increase correspondingly.