Figure 3-8 -A Decrease in the Equilibrium Quantity for a Product Will

question 187

Multiple Choice

Figure 3-8
-A decrease in the equilibrium quantity for a product will result

• A) when the quantity demanded for the product exceeds the quantity supplied.
• B) when there is a decrease in supply and a decrease in demand for the product.
• C) when there is an increase in supply and a decrease in demand for the product.
• D) when there is a decrease in demand and a decrease in the number of firms producing the product.

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Definitions:

Upsloping Line

In a graph, a line that rises from left to right, illustrating a positive relationship between two variables.

Interest-Rate Cost-Of-Funds Curve

As it relates to research and development (R&D), a curve showing the interest rate a firm must pay to obtain any particular amount of funds to finance R&D.

Expected-Rate-Of-Return Curve

As it relates to research and development (R&D), a curve showing the anticipated gain in profit, as a percentage of R&D expenditure, from an additional dollar spent on R&D.