Which of the Following Causes an Increase in Demand for a Normal

question 270

Multiple Choice

Which of the following causes an increase in demand for a normal good?

• A) Increase in the price of a substitute
• B) Increase in the price of a complement
• C) Decrease in price
• D) Decrease in income

Understand how efficiency and inefficiency are depicted by the PPF.

Associate the production of specific goods with points on the PPF, understanding opportunity costs related to varying production levels.

Comprehend the relationship between unemployment and the PPF.

Grasp the concept of the marginal rate of transformation and how it relates to the PPF slope.

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Definitions:

Common Size Percentages

Financial analysis tool that expresses each line item in a financial statement as a percentage of a base figure.

Cost of Goods Sold

Direct costs attributable to the production of the goods sold by a company, including materials and labor costs.

Current Ratio

A liquidity ratio that measures a company's ability to pay short-term obligations, calculated as current assets divided by current liabilities.

Financial Information

Data that pertains to the financial status, performance, and changes in the economic resources of an entity.