If Both Supply and Demand Simultaneously Decrease

question 226

Multiple Choice

If both supply and demand simultaneously decrease

• A) the market clearing price definitely rises, and the equilibrium quantity definitely falls.
• B) the market clearing price definitely rises, and the effect on the equilibrium quantity is indeterminate.
• C) the market clearing price definitely falls, and the effect on the equilibrium quantity is indeterminate.
• D) the effect on the market clearing price is indeterminate, and the equilibrium quantity definitely falls.

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Definitions:

Merit Pay

Merit pay is a compensation approach where employee performance directly influences the amount of pay increase or bonus they receive, aiming to reward excellence and motivate higher performance.

Individual-Level

Pertaining to or focusing on a single person as opposed to a group or collective.

Long-Term Basis

Refers to actions, plans, or relationships intended to last or be effective over an extended period of time.

Profit Sharing

Sharing profits with employees of an organization by the owners.