According to the Law of Demand

question 8

Multiple Choice

According to the law of demand,

• A)quantity supplied and quantity demanded are positively related.
• B)quantity supplied and quantity demanded are negatively related.
• C)price and quantity demanded are positively related.
• D)price and quantity demanded are negatively related.

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Definitions:

Factor Prices

The prices of inputs used in the production of goods or services, such as labor, capital, and raw materials.

Marginal Cost

The cost added by producing one additional unit of a product or service.

Marginal Cost Curve

A graphical representation showing how the cost of producing one additional unit of a good changes as production volume changes.

Total Fixed Costs

Expenses that do not change with the level of output or sales, such as rent, salaries, and insurance premiums.