Figure 14.1 -Refer to Figure 14.1.The Figure Above Represents the Market for the Market

question 73

Multiple Choice

Figure 14.1
-Refer to Figure 14.1.The figure above represents the market for pecans.Assume that this is a competitive market.If the price of pecans is $9, what changes in the market would result in an economically efficient output?

• A)The price would decrease, the quantity supplied would decrease, and the quantity demanded would increase.
• B)The quantity supplied would increase, the quantity demanded would decrease and the equilibrium price would decrease.
• C)The price would decrease, the demand would increase and the supply would decrease.
• D)The price would increase, the quantity demanded would decrease and the quantity supplied would increase.

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Definitions:

Critical Thinking

The objective analysis and evaluation of an issue in order to form a judgment, emphasizing logic, rationality, and skepticism.

Preattention

A cognitive process allowing the brain to focus on relevant stimuli while ignoring irrelevant information.

Base-Rate Information

Fundamental statistics or probabilities that are used for reference or as a baseline in decision-making processes.

Representativeness Heuristic

A mental shortcut that involves making judgments based on how much one thing resembles another, which can lead to biases in decision making.