An Economist Says,"Technological Advances Have the Power to Lower the Prices

question 71

Multiple Choice

An economist says,"Technological advances have the power to lower the prices of many of the goods we buy." Here is how this works:

• A) Technological advances lead to lower demand,which leads to lower prices.
• B) Technological advances lead to greater supply,which leads to lower prices.
• C) Technological advances lead to greater quantity supplied,which leads to lower prices.
• D) Technological advances lead to lower taxes,which lead to greater supply,which leads to lower prices.
• E) Technological advances lead to higher taxes,which lead to fewer subsidies,which lead to greater supply,which leads to lower prices.

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Definitions:

Raw Materials

are the basic, unprocessed inputs used in the manufacture of goods and products.

Indirect Materials

These are materials used in the production process that are not directly traceable to the finished product.

Production

The process of creating goods and services through the combination of labor, materials, and technology.

Direct Materials Cost

The cost of raw materials that can be directly traced to the production of goods, considered a variable cost in manufacturing.