When Technology Increases the Supply of a Good and Lower

question 31

Multiple Choice

When technology increases the supply of a good and lower prices increase the quantity demanded,

• A) the economy is reallocating resources to achieve an efficient allocation.
• B) consumer surplus falls.
• C) the invisible hand is unnecessary.
• D) the marginal benefit of the good increases with the quantity produced.
• E) the economy is no longer efficient because the quantity changes.

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Definitions:

Recognition Criteria

The conditions that must be met for a particular item to be included on the financial statements, ensuring transactions are recorded in the correct accounting period.

FASB

The Financial Accounting Standards Board, an independent nonprofit organization responsible for establishing accounting and financial reporting standards in the United States.

Recognition Criteria

The conditions that must be met for a particular item to be recognized in the financial statements, according to accounting standards.

Revenue Recognition

The accounting principle that dictates the specific conditions under which income becomes recognized as revenue in the financial statements.