Which of the Following Is True When the Price of a Good

question 56

Multiple Choice

Which of the following is true when the price of a good or service falls?

• A)Buyers who were already buying the good or service are worse off.
• B)More buyers enter the market.
• C)The total consumer surplus in the market decreases.
• D)The total value of purchases before and after the price change is the same.

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Definitions:

Recessions

Periods of economic decline when real GDP falls for two consecutive quarters, indicating a significant reduction in economic activity across the economy.

Inflation Rate

A rate, described in percentages, indicating how prices for various goods and services are climbing, which in turn decreases the value of money.

GDP Deflator

A measure of the level of prices of all new, domestically produced, final goods and services in an economy, used to deflate or adjust the nominal GDP to real GDP.

Intermediate Good

A product used as an input in the production of a final good or service.