What Is the Effect on the Price and Quantity of Wooden

question 245

Multiple Choice

What is the effect on the price and quantity of wooden desks of a rise in the price of wood?

• A) The equilibrium quantity of wooden desks increases and the equilibrium price falls.
• B) The equilibrium quantity of wooden desks increases and the equilibrium price rises.
• C) The equilibrium quantity of wooden desks decreases and the equilibrium price falls.
• D) The equilibrium quantity of wooden desks decreases and the equilibrium price rises.

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Definitions:

Valued Resources

Resources, either material or non-material, that are highly regarded and sought after in a society or by individuals.

Exchange Theory

Holds that social interaction involves trade in valued resources.

Altruistic Behavior

Actions motivated by the desire to help others without expecting anything in return.

Rational Choice Theory

A framework that assumes individuals act based on the rational evaluation of the costs and benefits of their actions to maximize personal advantage.