Which of the Following Explains Why Commodity Prices Have Fallen

question 7

Multiple Choice

Which of the following explains why commodity prices have fallen since 1850?

• A) The demand for productive resources has fallen faster than the supply of those resources.
• B) The demand for productive resources has grown faster than the supply of those resources.
• C) The supply of productive resources has increased, while the demand has fallen.
• D) The supply of productive resources has grown faster than the demand for those resources.

---

Definitions:

Economic Profits

The gap between a business's complete earnings and all its expenses, covering both overt and hidden costs.

Economic Profits

Profits calculated by subtracting both explicit and implicit costs from total revenues, reflecting true entrepreneurial success.

Reallocation Of Resources

The process of redistributing inputs and assets to different activities or areas to improve efficiency, productivity, or to meet strategic goals.

Production Costs

Expenses directly related to the creation of a product or service, including materials, labor, and overhead costs.