Other Things Equal, If the Price of a Key Resource

question 17

Multiple Choice

Other things equal, if the price of a key resource used to produce product X falls, the

• A) supply curve of product X will shift to the right.
• B) demand curve of product X will shift to the right.
• C) supply curve of product X will shift to the left.
• D) supply curve of product X will not shift.

---

Definitions:

Elastic

A term used in economics to describe a situation in which the supply or demand for a good or service is sensitive to changes in price.

Demand Curve

A graph showing the relationship between the price of a good and the quantity of that good consumers are willing and able to purchase, ceteris paribus.

Price Elasticity

The measure of how much the quantity demanded of a good responds to a change in the price of that good, expressing the sensitivity of demand to price changes.

Price Elasticity

An evaluation of how shifts in a good's price affect the quantity of it demanded.