A Decrease in Demand for a Good Could Mean That

question 60

Multiple Choice

A decrease in demand for a good could mean that

• A)consumers are willing to pay a higher price for each quantity of the good
• B)consumers are willing to buy larger quantities of the good at each price
• C)the demand curve has undergone a parallel shift to the right
• D)the demand curve has undergone a nonparallel shift to the right
• E)the demand curve has shifted to the left

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Definitions:

Marginal Cost

Marginal cost is the cost incurred by producing one additional unit of a product or service.

AVC

Average Variable Cost, which is the total variable costs (costs that change with the level of output) divided by the quantity of output produced.

Shut Down

The temporary or permanent cessation of operations, often referring to business closure due to economic events or strategic decisions.

Purely Competitive Seller

Describes a market situation where a large number of sellers offer identical products, and no single seller can influence the market price.