In Recent Years, the Cost of Producing Organic Produce in the United

question 103

Multiple Choice

In recent years, the cost of producing organic produce in the United States has decreased largely due technological advancement.At the same time, more and more Americans prefer organic produce over conventional produce.Which of the following best explains the effect of these events in the organic produce market?

• A)The supply curve has shifted to the left and the demand curve has shifted to the right. As a result there has been an increase in the equilibrium quantity and an uncertain effect on the equilibrium price.
• B)Both the supply and demand curves have shifted to the right. As a result, there has been an increase in the equilibrium quantity and an uncertain effect on the equilibrium price.
• C)Both the supply and demand curves have shifted to the right. As a result, there has been an increase in both the equilibrium price and the equilibrium quantity.
• D)The supply curve has shifted to the left and the demand curve has shifted to the right. As a result, there has been an increase in the equilibrium price and an uncertain effect on the equilibrium quantity.

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Definitions:

Profit Margin

a financial metric that shows the percentage of revenue remaining after all costs, expenses, and taxes have been deducted, indicating the efficiency and profitability of a company.

Asset Turnover

A financial ratio that measures the efficiency of a company's use of its assets in generating sales revenue, indicating how well assets are being utilized.

Common Size Balance Sheet

A financial statement that displays all items as percentages of a common base figure, allowing for easy comparison across time periods or companies by standardizing the data.

Plant & Equipment

Refers to tangible assets owned by a business used in production or supply of goods and services, not intended for sale.