When an Industry Has Excess Capacity, Market Prices May Drop

question 123

Multiple Choice

When an industry has excess capacity, market prices may drop well below their historical average. If this drop is temporary, it is called ________.

• A) distress prices
• B) dropped prices
• C) low-average prices
• D) substitute prices

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Definitions:

Cultural Heritage

The legacy of physical artifacts and intangible attributes of a group or society passed down from generation to generation.

Psychoactive Drug

A chemical substance that changes brain function and results in alterations in perception, mood, consciousness, cognition, or behavior.

Individual's Expectations

The beliefs or assumptions about the future events or actions held by an individual.

Drug Addict

An individual who has developed a psychological and/or physical dependence on illegal or prescription drugs.