Given a Positively Sloped Supply Curve,a Rise in the Demand

question 37

Multiple Choice

Given a positively sloped supply curve,a rise in the demand for that commodity causes

• A)a shortage of other goods.
• B)a fall in sales of that commodity.
• C)an increase in both the equilibrium price and the equilibrium quantity exchanged.
• D)a decrease in the equilibrium price and an increase in the equilibrium quantity exchanged.
• E)a decrease in both the equilibrium price and the equilibrium quantity exchanged.

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Definitions:

Volatile Returns

Refers to the significant ups and downs in the value of an investment over a short period.

Arbitrage Opportunity

A situation where a trader can make a profit from the price difference of an asset in different markets or forms without taking significant risk.

Risk-free Rate

The theoretical return of an investment with zero risk, often represented by the yield on government bonds.

Beta

A measure of a stock's volatility in relation to the overall market; a beta above 1 indicates greater volatility than the market, while a beta below 1 suggests less.