What Will Happen If Both the Demand for and Supply

question 106

Multiple Choice

What will happen if both the demand for and supply of a product decrease simultaneously?

• A)The effect on the price is indeterminate.
• B)The price will increase.
• C)The price will decrease.
• D)The effect on quantity traded is indeterminate.

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Definitions:

Package Carrier

A company or service that specializes in the transportation and delivery of parcels and packages, operating within postal, commercial, or freight contexts.

Private Fleet

A company-owned or leased set of transport vehicles dedicated to moving the company’s goods, providing control over logistics operations.

Lead Time Demand

The total demand for a product or service during its lead time, which is the time between order placement and delivery.

Safety Inventory

Additional stock kept on hand to protect against variability in demand or supply, ensuring that demand can be met without stockouts.