Suppose the market clearing price for apples falls from $3.00 to $2.00 per pound, and the overall market clearing output decreases from 1 million to 1/2 million pounds. How can we explain the fall in price and fall in market output?
A) Supply decreased and demand remained unchanged.
B) Supply remained unchanged and demand decreased.
C) Demand increased and supply remained unchanged.
D) Demand remained unchanged and supply increased.
B
Economics
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Whether a good is a luxury or necessity depends on the
a. price of the good. b. preferences of the buyer. c. intrinsic properties of the good. d. scarcity of the good.
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