FIGURE 4-2 -Refer to Figure 4-2. Which Movement of Equilibrium Illustrates an of Equilibrium

question 39

Multiple Choice

FIGURE 4-2

-Refer to Figure 4-2. Which movement of equilibrium illustrates an increase in the quantity supplied, but NOT an increase in supply?

• A) from Point B to Point D
• B) from Point D to Point C
• C) from Point D to Point B
• D) from Point C to Point D

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Definitions:

Fixed Costs

Costs that do not vary with the level of production or sales, such as rent, salaries, and insurance, remaining constant regardless of the amount of output or sales.

Sunk Cost

A past expenditure that cannot be recovered and should not be considered when making future investment decisions.

Nonrefundable

A term used to describe payments or fees that cannot be returned to the payer under most circumstances.

Nontransferable

A characteristic of certain rights or privileges that cannot be legally transferred from one individual or entity to another.