A decrease in the demand for a product will cause output of that product to
A) increase and the demand for and prices of the resources used to produce the product to rise.
B) decrease and both the demand for and prices of the resources used to produce the product to fall.
C) decline; the demand for the resources used to produce the product will remain constant.
D) increase; the price of resources used to produce the product will rise if their supply is elastic but fall if supply is inelastic.

Question

Quizplus · Accepted Answer

A decrease in demand for a product typically leads to a decrease in its output, which in turn reduces the demand for and prices of the resources used to produce that product.

A Decrease in the Demand for a Product Will Cause