A Decrease in Supply Results in A(n)

question 90

Multiple Choice

A decrease in supply results in a(n)

• A) decrease in demand
• B) increase in equilibrium quantity and a decrease in equilibrium price
• C) decrease in equilibrium quantity and a decrease in equilibrium price
• D) increase in demand
• E) increase in equilibrium price and a decrease in equilibrium quantity

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Definitions:

Contribution Margin

The amount remaining from sales revenue after variable expenses are deducted, indicating how much contributes to covering fixed costs and profit.

Special Order

An order for goods or services that is outside the company's normal production routine or product range.

Resale Value

The estimated amount that an asset or good will be sold for at the end of its useful life.

Replenished Material

Materials that have been restocked or resupplied to ensure adequate levels for production.