ECONOMICS
MONEY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Prices go up
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Prices go down
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Prices stay the same
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None of the above
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Detailed explanation-1: -The law of supply and demand states that when the demand for a good or service is higher than the supply, prices are likely to rise. In these circumstances, suppliers tend to produce more to satisfy the demand and take advantage of the margin opportunities.
Detailed explanation-2: -If the price goes up, the quantity demanded goes down (but demand itself stays the same). If the price decreases, quantity demanded increases. This is the Law of Demand. On a graph, an inverse relationship is represented by a downward sloping line from left to right.
Detailed explanation-3: -When market prices are higher, customers reduce their demand for goods and buy less, resulting in a downward sloping demand curve.
Detailed explanation-4: -Key Takeaways "Market Is Up” is a common phrase used when a given market closes higher than the day before. The opposite phrase is “the market is down” or “the market is off.” Markets usually trade higher when new information is disseminated.