Which of the Following Statements Are TRUE? I

question 103

Multiple Choice

Which of the following statements are TRUE? I. A high price for a good encourages consumers to economize on its use, seeking out alternatives. II. Rising prices give firms the incentive to bring more goods to the market. III. Firms that experience rising input prices will seek out substitute inputs and develop production technologies to conserve on the costly input.

• A) I only
• B) I and II only
• C) II only
• D) I, II, and III

---

Definitions:

Ice Cap

A mass of ice that covers less than 50,000 square kilometers but blankets land completely, often found in polar and subpolar regions.

Broadleaf Trees

Trees characterized by wide, flat leaves as opposed to needle-like leaves, common in deciduous forests.

Dormant

A state of physical or biological inactivity or rest, during which growth, development, and physical activity are temporarily stopped.

Chaparrals

A biome characterized by dense, evergreen shrubs and is found in regions with a Mediterranean climate, including parts of California and the Mediterranean basin.