As the price of DVD players has fallen over the last two years, more DVD players have been sold by consumer electronics firms. Is this a violation of the law of supply?
No. Very likely the reduction in price is due to an increase in supply (not an increase in quantity supplied). As DVD technology has progressed, DVD players have become standardized and more efficiently mass-produced, leading to an increase in supply. What has likely been observed is a rightward shift of the supply curve, not a movement along the supply curve.
You might also like to view...
Cyclical unemployment increases during recessions
Indicate whether the statement is true or false
Rational expectations theorists believe that governments publicizing their economic goals ______.
a. is necessary to educate the people, so they behave as intended b. leads people to act in their own interests and undercut the government’s intended outcomes c. prevents people from being able to anticipate the future of the economy d. is the most important step in being able to meet the government’s goals
In game theory, the strategy that always yields the highest benefit for the player using it is the
A) dominant strategy. B) cooperative strategy. C) prisoners' strategy. D) matrix strategy.
Refer to the table. If each of the 100 firms in the industry is maximizing its profit, each must have a marginal cost of:
A. $5.
B. $4.
C. $3.
D. $2.