A Decrease in Price Causes

question 74

Multiple Choice

A decrease in price causes:

• A) a quantity effect, which is an increase in revenue that results from selling fewer units of the good.
• B) a price effect, which is an increase in revenue that results from receiving a lower price for each unit sold.
• C) both a price effect and quantity effect.
• D) a decrease in quantity demanded.

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Definitions:

Independently Acting

Refers to an entity or person making decisions based on their own judgments or interests without coordination with others.

Product Scarcities

Situations where the supply of a product is insufficient to meet demand, often leading to increased prices and competition for available stock.

Private Property

Private property refers to the rights individuals or organizations have to own, use, and dispose of land, buildings, goods, or intellectual property privately, without interference from the government.