'An Increase in the Price of Petrol Will Increase the Demand

question 30

True/False

'An increase in the price of petrol will increase the demand for hybrid vehicles.' This statement is an example of a positive economic statement.

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Definitions:

Jointly Maximize

A strategy or action designed to optimize two or more objectives or outcomes at the same time.

Marginal Cost

The cost added by producing one extra unit of a product or service.

Output Effect

The change in total revenue resulting from selling more units at a lower price, in the context of price elasticity of demand.

Socially Efficient

An allocation of resources is considered socially efficient if it cannot be reallocated in a way that improves the wellbeing of one individual without worsening the situation of another.