When Consumer Demand for a Good Produced in a Price-Taker

question 133

Multiple Choice

When consumer demand for a good produced in a price-taker market decreases,

• A) firms in the industry will continue to produce at the same output levels as before.
• B) total market output will generally rise, but each individual firm will reduce its output.
• C) the market price of the good will rise, causing additional resources to flow into the industry in the long run.
• D) some firms will shut down in the long run, making their resources available for the production of other goods.

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Definitions:

Cerebral Cortex

Part of the forebrain, the outer layer of the brain, responsible for the most complex mental functions, such as thinking and planning.

Cannon-Bard Theory

A theory of emotion that argues emotions and bodily responses occur simultaneously, not sequentially.

James-Lange Theory

The James-Lange theory proposes that emotions result from the perception of bodily reactions to stimuli, rather than directly from the stimuli.

Cannon-Bard Theory

The psychological theory proposing that emotions and physiological reactions occur simultaneously, rather than one causing the other.