The Law of Supply States That, Other Things Equal, When

question 104

Multiple Choice

The law of supply states that, other things equal, when the price of a good

• A)falls, the supply of the good rises.
• B)rises, the quantity supplied of the good rises.
• C)rises, the supply of the good falls.
• D)falls, the quantity supplied of the good rises.

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Definitions:

Economies of Scale

The economic benefits companies achieve through expanding their scale of activity, as the cost for every unit of output falls with the growth in scale.

Income

The financial earnings received by an individual or entity, typically measured over a certain period of time.

Utility-Maximizing

A principle in economics wherein individuals or entities make choices that result in the highest level of satisfaction.

R&D Expenditures

Money spent on research and development activities to innovate and improve products or processes.