When Supply and Demand Both Increase, the

question 384

Multiple Choice

When supply and demand both increase, the

• A) quantity definitely decreases.
• B) quantity definitely increases.
• C) price definitely increases.
• D) price definitely decreases.

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Definitions:

Fixed Costs

Business expenses that remain constant regardless of the level of production or sales activity, such as rent, salaries, and insurance.

Average Costs

The total cost of production divided by the number of goods produced, reflecting the average expense per unit.

Variable Costs

Expenses that change in proportion to the activity of a business, such as costs for raw materials or production.

Shut Down

The process of ceasing operations, typically referring to temporarily or permanently closing a business or facility.