Solved

Refer to the Graphs

Question 8

Multiple Choice

Refer to the graphs. Suppose a firm is currently producing 500 computers per week and charging a price of $1,000. How will the firm respond to a negative demand shock if prices are flexible? A) The firm will continue to produce 500 computers per week and charge a price of $600. B) The firm will continue to produce 500 computers per week and charge a price of $1,200. C) The firm will cut production to 300 computers per week and charge a price of $1,000. D) The firm will cut production to 300 computers per week and charge a price of $600. Refer to the graphs. Suppose a firm is currently producing 500 computers per week and charging a price of $1,000. How will the firm respond to a negative demand shock if prices are flexible?


A) The firm will continue to produce 500 computers per week and charge a price of $600.
B) The firm will continue to produce 500 computers per week and charge a price of $1,200.
C) The firm will cut production to 300 computers per week and charge a price of $1,000.
D) The firm will cut production to 300 computers per week and charge a price of $600.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Q3: Citizens living in the richest nations today

Q4: Sticky prices could be the result of

Q5: Prices tend to be stickier in the

Q6: If prices of goods and services were

Q7: Which of the following statements best describes

Q9: (Last Word) Behavioral economics incorporates culture and

Q10: Harry's Pizza Parlor produced 10,000 large pizzas

Q11: (Consider This) The term "economic investment" refers

Q12: On average, salaries and wages make up

Q13: Which of the following statements best describes