When the Demand for a Good Decreases,its Equilibrium Price ________

question 182

Multiple Choice

When the demand for a good decreases,its equilibrium price ________ and equilibrium quantity ________.

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

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Definitions:

Oligopolists

Companies or entities that are part of a market structure with a small number of players dominating the industry.

Advertising Expenditures

The amount of money spent by companies to promote their products or services through various media channels.

Market Share

Market share is the portion of a market controlled by a particular company, measured in terms of sales revenue or unit sales compared to the total market.

Kinked-demand Curve Model

An economic theory that suggests that prices in an oligopolistic market will remain stable because businesses will match price cuts but not price increases by competitors.