If Other Factors Remain Unchanged, Technological Progress in Producing Good

question 58

Multiple Choice

If other factors remain unchanged, technological progress in producing good X definitely will lead to

• A)an increase in the market clearing price of good X and a decrease in the equilibrium quantity of good X.
• B)an increase in both the market clearing price and the equilibrium quantity of good X.
• C)a decrease in the market clearing price of good X and an increase in the equilibrium quantity of good X.
• D)a decrease in both the market clearing price and the equilibrium quantity of good X.

---

Definitions:

Semiannual Interest

Interest on a loan or investment calculated and paid twice a year, typically at a fixed rate.

Parent Company

A parent company is a corporation that owns enough voting stock in another firm to control management and operations by influencing or electing its board of directors.

Subsidiary Company

A subsidiary company is one that is controlled by another company, typically referred to as the parent company, through ownership of more than half of the subsidiary’s voting stock.

Equity Method

This accounting technique is used for consolidating the financial statements of a company in which the investing company holds significant influence, but not full control or majority ownership.