If input prices rose and production technology improved at the same time,as a result:
A) prices would rise.
B) prices would fall.
C) larger quantities to be exchanged.
D) we would not know which direction either prices or quantities exchanged would be altered without more information.

Question

Quizplus · Accepted Answer

There are two opposing factors at play - one aspect (input prices) would increase prices, while the other (production technology) would decrease prices. Without more information, we cannot determine which factor would have a greater impact on prices or how it would affect quantities exchanged. Therefore, the answer is D.

If Input Prices Rose and Production Technology Improved at the Same