Variables a and B Are Inversely Related

question 101

Multiple Choice

Variables A and B are inversely related.If we plot A on the horizontal axis and B on the vertical axis,the line that connects combinations of A and B plotted in a two-variable diagram would be

• A) parallel to the horizontal axis.
• B) downward-sloping (left to right).
• C) parallel to the vertical axis.
• D) upward-sloping (left to right).
• E) a or c

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Definitions:

Incentive Function

The inducement that an increase in the price of a commodity gives to sellers to make more of it available (and conversely for a decrease in price), and the inducement that an increase in price offers to buyers to purchase smaller quantities (and conversely for a decrease in price).

Loan Period

The duration of time from the initiation of a loan to its final due date, within which the borrower is expected to repay the borrowed amount along with interest.

Interest Rate

The percentage of a sum of money charged for its use, typically expressed as an annual percentage rate.

Economic Resource

Assets, materials, or inputs used to produce goods and services and satisfy human wants, including land, labor, capital, and entrepreneurship.