If the Price of Automobiles Were to Decrease Substantially,the Demand

question 173

Multiple Choice

If the price of automobiles were to decrease substantially,the demand curve for public transportation would most likely

• A)shift rightward.
• B)shift leftward.
• C)remain unchanged.
• D)remain unchanged while quantity demanded would change.

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Definitions:

Direct Materials

Costs of raw materials that are directly used in the production of a product, easily traceable to the product being manufactured.

Direct Labor

The labor costs directly associated with the production of goods or services, including wages of workers directly involved in production.

Manufacturing Overhead

All manufacturing costs that are not directly related to the production of a product, including indirect materials, labor, and other expenses.

Insurance

A contractual agreement where one party, the insurer, agrees to compensate another, the insured, for loss on a specified subject by specified perils in return for a premium.