Assuming the Most Typical Shapes of the Demand and Supply

question 19

Multiple Choice

Assuming the most typical shapes of the demand and supply curves,which of the following could lead to an increase in the current equilibrium price for personal computers?

• A) a decrease is the price of computer chips
• B) a decrease in buyers' incomes,assuming that computers are a normal good
• C) a technological improvement that reduces manufacturing costs
• D) expectations of a higher future price
• E) an increase in the price of computer software

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Definitions:

Total Revenue Curve

A graphical representation that shows how total revenue changes with variations in the quantity of goods or services sold, illustrating the relationship between price and demand.

Quantity Sold

The total number of units of a product sold within a given time frame.

Predatory Pricing

A strategy where a business sets prices below cost intending to eliminate competitors and gain market dominance.

Product-Cost Information

Data regarding the total costs incurred in the creation of a product, including direct materials, labor, and overhead expenses.