Refer to the Graphs Above

question 31

Multiple Choice

Refer to the graphs above. Suppose a firm is currently producing 500 computers per week and charging a price of $1000. What happens to the firm's inventory of computers if there is a negative demand shock and prices are flexible?

• A) The firm's inventories will not change
• B) The firm's inventories will increase by 200 computers per week
• C) The firm's inventories will decrease by 150 computers per week
• D) The firm's inventories will increase by 350 computers per week

---

Definitions:

Informal Rulemaking

A regulatory process that involves the publication of a proposed rule and the consideration of public feedback before finalizing the rule.

Federal Register

The official journal of the federal government of the United States that contains government agency rules, proposed rules, and public notices.

Constitutional Tests

Judicial standards and criteria used to evaluate laws and government actions to ensure they conform with the Constitution.

Administrative Action

Decisions and operations carried out by government or organizational bodies in the execution of their duties.