The law of supply A states that price and quantity supplied are inversely relate
ID: 1128630 • Letter: T
Question
The law of supply A states that price and quantity supplied are inversely related. B. states that price and quantity supplied are directly related. C. is identical to the law of demand. D. None of these choices are correct 7. 8 An increase in demand occurs when A quantity demanded is greater than quantity supplied. B. quantity supplied is greater that quantity demanded. C. the demand curve shifts upward and to the right. D. There is a leftward shift in the demand curve 9. At relatively high levels of disposable income · A both the APC and APS are high. B. both the APC and APS are low. C. the APC is high and the APS is low. D. the APC is low and the APS is high. 0 When there is dissaving A. both the APC and APS are positive. B. both the APC and APS are negative. C. the APC is positive and the APS is negative. D. the APC is negative and the APS is positive. 11. Since 1980, inventory investment has A. always been positive. B. always been negative. C. been both positive and negative. 12. Which statement is false? A. Most corporations are small firms. B. Most firms in the United States are proprietorships. C. Preferred stockholders rarely have a voice in running corporations. D. None of these statements are false. tax. The most important source of state tax revenue is the A. property B. income C. excise 13. D. salesExplanation / Answer
Answer 7 - The law of supply states that price of a good and quantity supplied of that good is directly related. In means higher quantity would be supplied on higher price and vice versa. That is called 'Law of supply''. The supply curve slops positive from left to right. As price of good rises, quantity supplied in the market also rises.
Option B is the correct answer.
Answer 8 - An increase in demand curve occurs when demand curve shifts upward to the right. This shift shows higher quantities at a given prices. Increase in demand happen when factor that affects demand changes except price.
Option C is the correct answer.
Answer 9 - At relative high level of disposable income average propensity to consume (APC) is low and Average propensity to save (APS) is high. It is so because as income increases expenditure on consumption decreases subsequently. The savings increases as income raises thus APS increases in the long term.
Option D is the correct answer.
Answer 10 - When there are dissavings, APC would be positive and APS would be negative. An individual's consumption cannot be negative; if an individual is alive then he must have consumed something. Savings may be negative. Thus APC would be positive but APS would be negative. Consumption of a person will be positive if he is alive.
Option C is the correct answer.
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