An increase in the price of beef providers information which ?
Correct answer: C. tells producers to produce more beef.
- A. provides no information because prices in a market system are managed by planning boards.
- B. tells consumers to buy less pork
- C. tells producers to produce more beef.
- D. tells consumers to buy more beef.
Explanation
A higher beef price signals stronger returns to beef producers, encouraging them to supply more beef. It also normally encourages consumers to buy less beef, not more pork specifically.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? [email protected]
About Microeconomics
Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
Practise Microeconomics
1,742 free Microeconomics MCQs from Economics, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Discussion
Stuck on an option, or know a faster way to get there? Ask or explain it here.
No comments yet. Be the first to explain this one.
Exams that ask Economics questions like this
Economics is on 3 papers prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for every one of them.
More Microeconomics questions
Economics is the study of ?
If the diagram of a line shows that lower values on the vertical scale are associated with higher values on the horizontal scale this is an example of ?
when a market is in equilibrium ?
Which of the following statements is true about a market economy ?
Which of the following products would be least capable of producing an externality ?
A rational person does not act unless ?