QAEconomics › Which statement best compares the laws of supply and demand?
Q

Which statement best compares the laws of supply and demand?

a) The two economic laws exist in theory. They have no relation to economics in the real world.

b) The two economic laws exist in theory. They work in practice, but real-world factors can have an effect.

c) The two economic laws work in practice. They apply to real-world economics eighty percent of the time.

d) The two economic laws work in practice. They prove to be true in the real world one hundred percent of the time.

A

The correct choice is B – The two economic laws exist in theory. They work in practice, but real-world factors can have an effect. The law of demand and supply explains the interactions that exist between buyers and sellers from the sides of a given resource. For instance, when the price of goods shoots up, the demand tends to move down. Even with this, it has been found that real factors can interfere with this demand and supply law and make it of no effect. For example, in the event of a catastrophe, the demand for goods may still be high despite increased prices due to the prevailing circumstances.

2 months ago
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