As a Result of an Increase in a Product's Price

question 23

Multiple Choice

As a result of an increase in a product's price, the:​

• A)supply of the product increases.
• B)supply of the product decreases.
• C)quantity supplied of the product increases.
• D)quantity supplied of the product decreases.
• E)quantity demanded of the product increases.

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Definitions:

Fixed Overhead

Denotes the regular, recurring costs associated with running a business that do not fluctuate with production volume, such as rent, salaries, and utilities.

Net Income

Net income is the total earnings of a company after all expenses and taxes have been deducted from total revenue, indicating the company's profit.

Inventory

Goods and materials that a business holds for the ultimate goal of resale or processing.

Variable Costing

A costing method that includes only variable production costs—direct materials, direct labor, and variable manufacturing overhead—in product cost determination.