We Observe That the Equilibrium Price of Digital Cameras Has

question 212

Multiple Choice

We observe that the equilibrium price of digital cameras has fallen and the equilibrium quantity of digital cameras has increased. Which of the following events could be responsible for this?

• A) Technological advances in digital camera production.
• B) Consumers' preferences changed in favor of digital cameras.
• C) The price of film cameras rose.
• D) Workers who make digital cameras received a pay raise.

---

Definitions:

Hourly Wages

The amount of money paid to an employee for one hour of work.

Income Effect

Variations in the income levels of individuals or economies and the resultant effects on the demand for goods or services.

Substitution Effect

The economic understanding that as prices rise or incomes decrease consumers will replace more expensive items with less costly alternatives.

Hourly Wages

The amount of earnings paid to an employee for each hour worked.