"The price of digital cameras fell because of improvements in production technology. As a result, the demand for non-digital cameras decreased
This caused the price of non-digital cameras to fall; as the price of non-digital cameras fell the demand for non-digital cameras decreased even further." Evaluate this statement.
A) The statement is false because the demand for non-digital cameras would increase as the price of digital cameras fell.
B) The statement is false because digital camera producers would not reduce their prices as a result of improvements in technology; doing so would reduce their profits.
C) The statement is false. A decrease in the price of digital cameras would decrease the demand for non-digital cameras, but a decrease in the price of non-digital cameras would not cause the demand for non-digital cameras to decrease.
D) The statement is false because it confuses the law of demand with the law of supply.
C
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