As the Demand for a Product Falls, It Is Not

question 30

Multiple Choice

As the demand for a product falls, it is not uncommon for the industry to become a monopoly.This is most likely due to

• A)an increase in the number of barriers.
• B)legal restrictions being imposed.
• C)the surviving firm operating on the declining part of its average cost curve.
• D)patent protection causing high prices.

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Definitions:

Inventories Valuation

The method used to assess the cost or market value of inventories a company holds at the end of a financial period to ensure accurate financial reporting.

Nominal Charge

A minimal or symbolic fee often charged to meet legal requirements rather than to cover the cost of services.

Consumption

The use of goods and services by households.

Restricted Fund Method

An accounting technique for managing funds that have specific purposes or restrictions placed upon their use by donors.