If You Were to Put the Following Effects of a Decrease

question 12

Multiple Choice

If you were to put the following effects of a decrease in demand into the sequence in which they occur, which would be last?

• A)The demand curve facing each individual firm drops.
• B)Each firm reduces quantity supplied to the point where marginal cost equals its now-lower marginal revenue.
• C)In the short run, the market price drops.
• D)Market output falls.
• E)A short-run loss forces some firms out of business in the long run.

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Definitions:

Profit Centers

Refers to distinct parts of a business that directly contribute to the company's profit through their operations and performance assessment.

Direct Expenses

Costs that can be directly attributed to the production of specific goods or services, such as raw materials and labor.

Allocation

The process of distributing resources or costs among various accounts or departments based on a specific criteria.

Departments

Distinct areas within an organization, each specializing in specific functions or tasks.