Ceteris Paribus, as the Price of a Good or Service

question 229

Multiple Choice

Ceteris paribus, as the price of a good or service increases

• A) people will buy more of it.
• B) people will buy less of it.
• C) people will want less of it.
• D) people will want more of it.

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Definitions:

Elasticity

A measure of how much the quantity demanded or supplied of a good or service changes in response to a change in its price.

Price of a Resource

The monetary value assigned to a raw material, energy, or other fundamental inputs used in the production of goods and services.

Substitute Inputs

Alternatives that can be used in the production process if the original inputs become too expensive or unavailable.

Consumers

Individuals or groups who use goods and services to satisfy their personal needs and desires.