The Set of Activities That Transforms Raw Resources into the Goods

question 46

Multiple Choice

The set of activities that transforms raw resources into the goods and services end users purchase and consume is called the:

• A) value chain.
• B) supply chain.
• C) demand chain.
• D) cost-benefit analysis.

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Definitions:

Elasticity of Supply

An evaluation of the extent to which the amount of a good provided alters as a result of variations in its price.

Equilibrium Price

The price at which the quantity of goods supplied equals the quantity of goods demanded.

Linear Supply

A supply relationship showing a direct, constant increase in quantity supplied as price increases.

Free Market Equilibrium

A state in an economy where supply meets demand naturally without intervention, and prices are determined by free market forces.