question archive A television station reports that more people are purchasing personal computers
Subject:MarketingPrice:2.88 Bought3
A television station reports that more people are purchasing personal computers. A likely explanation of this event would be a(n):
a. increase in the demand for and the supply of computers
b. decrease in the demand for the supply of computers
c. increase in the supply of computers and a decrease in the demand for computers
d. decrease in the supply of computers and an increase in the demand for computers
The correct answer is a. increase in the demand for and the supply of computers.
The increased supply means that prices fall. This, in turn, attracts more customers. At the same time, there is an increase in demand. As this is met with an increased supply, the negative impact of any price rise is reduced.