5
Question
In a free market economy, when consumers increase their purchase of a good and the level of _________ exceeds ________ then prices tend to rise.
In a free market economy, when consumers increase their purchase of a good and the level of _________ exceeds ________ then prices tend to rise.
Open in App
Solution
The correct option is A demand; supply
When a free market economy operates then price determination takes place through the combined forces of demand and supply of the commodity. When the consumers purchase larger quantities of a good, its demand increases, while the supply remains unchanged, which leads to a rise in the general price level.
When a free market economy operates then price determination takes place through the combined forces of demand and supply of the commodity. When the consumers purchase larger quantities of a good, its demand increases, while the supply remains unchanged, which leads to a rise in the general price level.
Suggest Corrections
0
Similar questions