Assume That an Inferior Good Is Produced in a Perfectly

question 18

Multiple Choice

Assume that an inferior good is produced in a perfectly competitive,increasing-cost industry with external diseconomies.The market is initially in long-run equilibrium.After all long-run adjustments are made,which of the following would occur in this market as a result of an increase in consumers' incomes?

• A)The market price would remain unchanged;the market quantity would rise.
• B)The market price would rise;the market quantity would fall.
• C)The market price would remain unchanged;the market quantity would fall.
• D)Both the market price and the market quantity would fall.
• E)Both the market price and the market quantity would rise.

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Definitions:

Psychoanalytic

Pertaining to a theory and therapeutic method developed by Sigmund Freud, focusing on unconscious motivations and conflicts as determinants of human behavior.

Client-Centred Therapies

Psychological treatments that emphasize the client's self-discovery, self-acceptance, and a growth-oriented process, developed by Carl Rogers.

Self

The individual’s recognition of their own identity, characterized by personal awareness and the understanding of one’s own thoughts, feelings, and actions.

Chronic Anxiety

A persistent state of excessive worry and fear that interferes with daily activities, often a symptom of an anxiety disorder.