If Consumers Suddenly Began Desiring More Apples and Fewer Oranges

question 418

Multiple Choice

If consumers suddenly began desiring more apples and fewer oranges,

• A) the market price of apples would rise, creating short-run economic profits in the apple industry. Current firms will expand output and new firms will enter the industry.
• B) the market price of oranges would fall, creating short-run economic losses in the orange industry. Current firms will reduce output and some will go out of business in the long run.
• C) neither a nor b are correct.
• D) both a and b are correct.

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Definitions:

Company's Name

The distinctive designation of a business, under which it operates and is legally registered.

Target Market

designates a specific group of consumers at which a company aims its products or services.

Reminder Institutional

An advertising strategy aimed at reminding consumers about the existence and benefits of an institution, typically used to reinforce brand identity and loyalty.

U.S. Army

The land warfare service branch of the United States Armed Forces responsible for land-based military operations.