When the Price Rises and the Supply Curve Does Not

question 176

Multiple Choice

When the price rises and the supply curve does not shift,the firms' producer surplus ________.When the price falls and the supply curve does not shift,the firms' producer surplus ________.

• A) increases; decreases
• B) decreases; increases
• C) decreases; decreases
• D) increases; increases
• E) does not change; does not change

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Definitions:

Mutually Exclusive

A statistical term describing two or more events that cannot occur simultaneously.

Salvage Value

The estimated residual value of an asset at the end of its useful life, important for depreciation calculations.

Internal Rate Of Return (IRR)

The discount rate that makes the NPV of an investment zero.

Straight-Line Depreciation

A technique for distributing the expense of a physical asset evenly across its lifespan in identical yearly payments.