Which Statement Accurately Summarizes the Relationship Between the Prices of Goods

question 93

Multiple Choice

Which statement accurately summarizes the relationship between the prices of goods and their relative scarcity?

• A)The price of a good is a direct function of the relative scarcity of the good.
• B)The price of a good is an inverse function of the relative scarcity of the good.
• C)The price of a good is independent of the relative scarcity of the good.
• D)High prices lead to greater relative scarcity.

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Definitions:

Net Income

Total earnings of a company after all expenses and taxes have been deducted from total revenue.

Note Receivable

A financial asset representing a written promise for a debtor to pay a specified sum of money to the creditor on a demand or at a future date.

Financing Activities

Activities that result in changes in the size and composition of the equity capital or borrowings of the entity, reflected in its cash flows.

Principal Collection

refers to the portion of payments received that goes towards reducing the outstanding principal balance of a loan.