"Other Things Equal, When the Price of a Good Rises

question 130

Multiple Choice

"Other things equal, when the price of a good rises, the quantity demanded of the good falls, and when the price falls, the quantity demanded rises." This relationship between price and quantity demanded is referred to as

• A) equilibrium.
• B) the law of demand.
• C) the relationship between supply and demand.
• D) the definition of an inferior good.

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Definitions:

Financial Measures

Quantitative indicators used to assess the financial stability, performance, or position of a business or economy.

Federal Reserve

is the central banking system of the United States, responsible for managing the nation's monetary policy and overseeing its banking institutions.

Automatic Stabilizers

Programs such as unemployment insurance benefits and taxes that are already on the books to help alleviate recessions and hold down the rate of inflation.

Government Surplus

The situation where a government's revenue exceeds its expenditures during a given timeframe, indicating a positive fiscal balance.