What Is Likely to Happen When Demand for a Commodity

question 112

Multiple Choice

What is likely to happen when demand for a commodity is high?

• A) Consumers will try to find substitutes for the commodity.
• B) The price of the commodity will rise.
• C) Criminal behaviour increases with regard to the commodity (e.g., stealing).
• D) The price of substitute commodities will increase.
• E) All of these statements are correct.

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Definitions:

Net Income

The profit of a company after all expenses, taxes, and deductions have been subtracted from total revenue.

Debt Ratio

A financial ratio that measures the proportion of a company's assets that are financed by debt.

Assets

Economic resources owned or controlled by an individual or entity that are expected to produce value or benefit in the future.

EBIT

Earnings Before Interest and Taxes, a measure of a firm's profit that includes all expenses except interest and income tax expenses.