Suppose We Observe the Following Two Simultaneous Events in the Market

question 119

Multiple Choice

Suppose we observe the following two simultaneous events in the market for beef. First, there is a decrease in the demand for beef due to changes in consumer tastes. And second, there is a reduction in supply due to cattle farmers selling their land to real estate developers. We know with certainty that these two simultaneous events will cause which of the following?

• A)no change in the equilibrium quantity and a reduction in the equilibrium price
• B)an increase in the equilibrium quantity and in the equilibrium price
• C)a decrease in the equilibrium quantity and an indeterminate change in the equilibrium price
• D)a decrease in the equilibrium quantity and an increase in the equilibrium price

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Definitions:

Multiplication Concept

A fundamental mathematical operation representing the repeated addition of a number by itself a specified number of times.

Wilcoxon Signed-Rank Test

A nonparametric statistical test used to compare two paired samples to assess whether their population mean ranks differ.

Relative Frequency Distributions

A representation of the number of times each value occurs relative to the total number of values in a data set.

Specified Median

A particular or defined median value within a dataset, often set as a target or comparison benchmark.