The Demand for Oranges Increases While the Supply Decreases

question 219

Multiple Choice

The demand for oranges increases while the supply decreases.The equilibrium price of oranges ________,and the equilibrium quantity ________.

• A) rises; decreases
• B) falls; perhaps changes but we can't say if it increases, decreases, or stays the same
• C) falls; increases
• D) does not change; perhaps changes but we can't say if it increases, decreases, or stays the same
• E) rises; perhaps changes but we can't say if it increases, decreases, or stays the same

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Definitions:

Warranty Expense

The estimated cost of honoring product warranties, which companies recognize to match expenses with related revenues.

Estimated Warranty Costs

Projected expenses that a company expects to incur to repair or replace products during a warranty period.

Estimated Liability

A financial obligation that is expected to occur but has not been finalized in amount or timing.

Warranty Expenses

Costs that a company anticipates for repairing or replacing defective products sold to customers under warranty.