Suppose That New Demands Greatly Reduce the Proved Reserves of Titanium

question 210

Multiple Choice

Suppose that new demands greatly reduce the proved reserves of titanium to unexpectedly low levels, and it appears that the new demands will continue. If the market price is unregulated, we should expect that the price will

• A) rise sharply, calling forth added exploration and more effective (and more costly) recovery methods, resulting in additional new supplies of titanium.
• B) rise sharply, calling forth new ways for manufacturers to conserve titanium and to find substitutes for it.
• C) over time, bring the quantity supplied of titanium into balance with the quantity demanded.
• D) do all of the above.

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Definitions:

Market Share

The portion of a market controlled by a particular company or product, often expressed as a percentage of total sales in that market.

Forward Buying

The practice of purchasing goods in advance of need, often in larger quantities, to take advantage of favorable pricing, secure inventory, or hedge against future price increases.

Market Growth

An increase in the demand for a particular product or service over time, often measured by changes in sales and market share.

Stealing Share

A competitive strategy aimed at gaining market share from competitors by attracting their customers, rather than expanding the overall market.