-The Graph Illustrates the Supply of Sweaters

question 49

Multiple Choice

-The graph illustrates the supply of sweaters.Which of the following events will increase the supply of sweaters?

• A) a rise in the price of a sweater
• B) a rise in the wage rate paid to the workers who make sweaters
• C) a rise in the expected future price of a sweater
• D) an increase in the number of sellers of sweaters
• E) an increase in income if sweaters are a normal good

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Definitions:

Stock Options

Financial derivatives that give the holder the right, but not the obligation, to buy or sell shares of a company at a specified price before a certain date.

Open Market

An economic system in which prices for goods and services are determined by unrestricted competition between privately owned businesses.

Capital Gains Rate

The tax rate applied to the profit from selling an asset that has increased in value.

Profit-sharing Bonuses

A type of incentive given to employees where they receive a share of the company’s profits, typically as part of their compensation package.