Figure 3-8 -Refer to Figure 3-8.The Graph in This Figure Illustrates an Figure

question 224

Multiple Choice

Figure 3-8
-Refer to Figure 3-8.The graph in this figure illustrates an initial competitive equilibrium in the market for sugar at the intersection of D1 and S2 (point B) .If there is an decrease in the price of fertilizer used on sugar cane and there is a decrease in tastes for sugar-sweetened soft drinks,how will the equilibrium point change?

• A)The equilibrium point will move from B to A.
• B)The equilibrium point will move from B to C.
• C)There will be no change in the equilibrium point.
• D)The equilibrium point will move from B to E.

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Definitions:

Financial Institutions

Organizations that provide financial services, such as banks, insurance companies, and stock exchanges.

Market Prices

The existing rate at which a service or asset is offered for buying or selling in the market environment.

Efficiency

The extent to which assets, resources, and time are used effectively to achieve a desired outcome, often measured in terms of output per input.

Semi-strong Form

A concept in efficient market hypothesis proposing that all publicly available information is fully reflected in stock prices.