Other Things Constant, as the Price of a Resource Increases

question 257

Multiple Choice

Other things constant, as the price of a resource increases,

• A) the quantity of the resource demanded falls.
• B) the quantity of the resource supplied falls.
• C) the price of the product the resource helps to produce falls.
• D) there is less of an incentive for users of the resource to find substitute resources.

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Definitions:

Financial Statement

Documents that provide an overview of a company's financial condition in both short and long term, including balance sheets, income statements, and statements of cash flows.

Permanent/Temporary

In accounting, refers to the classification of accounts based on their longevity; permanent accounts are cumulative over time (e.g., assets, liabilities, equity), while temporary accounts are closed at the end of each accounting period (e.g., revenues, expenses).

Normal Balance

The side (debit or credit) on which increases to the account are recorded, based on the type of account (asset, liability, equity, revenue, expense).

Financial Statement

A written report that quantitatively describes the financial health of a company, including balance sheets, income statements, and cash flow statements.