Which of the Following Events Would Unambiguously Cause a Decrease

question 120

Multiple Choice

Which of the following events would unambiguously cause a decrease in the equilibrium price of cotton shirts?

• A)an increase in the price of wool shirts and a decrease in the price of raw cotton
• B)a decrease in the price of wool shirts and a decrease in the price of raw cotton
• C)an increase in the price of wool shirts and an increase in the price of raw cotton
• D)a decrease in the price of wool shirts and an increase in the price of raw cotton

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Definitions:

Mark-up

Extra costs applied to the basic price of goods for overhead absorption and profitability.

Overhead Expenses

Ongoing costs of operating a business that are not directly associated with the production of goods or services, such as rent, utilities, and administrative costs.

Operating Profit

The income generated by a company's main business activities, not including interest and tax deductions.

Markdown

A reduction from the original or previous selling price of goods or services.