Which of the Following Statements Is CORRECT

question 505

Multiple Choice

Which of the following statements is CORRECT?

• A) When demand decreases, both the price and the quantity increase.
• B) When demand increases, both the price and the quantity decrease.
• C) When supply increases, the quantity increases and the price falls.
• D) When supply decreases, both the price and the quantity decrease.

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Definitions:

Plant Assets

Long-term tangible assets that are used in the production of goods or services, such as buildings, machinery, and equipment.

Salvage Value

The estimated residual value of an asset at the end of its useful life, reflecting what it could be sold for or scrapped.

Book Value

The net value of a company's assets as recorded on the balance sheet, typically used as a measure to assess whether a stock is under- or overvalued.

Historical Cost

The original monetary value of an asset or transaction, based on the purchase price or cost at the time of acquisition.