An Increase in the Demand for a Product and a Reduction

question 48

Multiple Choice

An increase in the demand for a product and a reduction in its costs of production would

• A)decrease the profits of producers.
• B)encourage firms to leave an industry.
• C)encourage firms to enter an industry.
• D)cause a shortage of the product.

---

Definitions:

Multi-component

Pertains to something that is composed of multiple elements or parts.

Cohesion

The extent to which members of a group or community are united in pursuing common goals or supporting each other.

Friends

Individuals with whom one has a bond of mutual affection, typically exclusive of sexual or family relations.

Family

A social unit consisting of parents and their children, considered as a group, whether dwelling together or not; also refers to people who may or may not be related by blood or marriage but share close bonds.