[amp_mcq option1=”Price” option2=”Quantity” option3=”Supply” option4=”None of the above” correct=”option1″]<\/p>\n
The correct answer is A. Price.<\/p>\n
Demand is a function of price because, all other things being equal, the higher the price of a good, the less people will demand it. Conversely, the lower the price, the more people will demand it. This is because people have a limited amount of money to spend, and they will want to get the most value for their money. If a good is expensive, they will only buy a small amount of it, if any. But if it is cheap, they will be more likely to buy more of it.<\/p>\n
Quantity is not a function of demand because, all other things being equal, the quantity of a good that is demanded does not depend on the quantity that is supplied. The quantity demanded is determined by the price of the good, the income of consumers, the prices of other goods, and consumer tastes. The quantity supplied is determined by the cost of production, the prices of inputs, and technology.<\/p>\n
Supply is not a function of demand because, all other things being equal, the quantity of a good that is supplied does not depend on the quantity that is demanded. The quantity supplied is determined by the cost of production, the prices of inputs, and technology. The quantity demanded is determined by the price of the good, the income of consumers, the prices of other goods, and consumer tastes.<\/p>\n
Therefore, the correct answer is A. Price.<\/p>\n","protected":false},"excerpt":{"rendered":"
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