According to the circular flow of income and output, which of the following is not true? A) The price a firm charges for its product or service influences the quantity it produces. B) When production costs increase, firms can raise prices without losing as many sales. C) As incomes rise, consumption rises. D) Firms cannot change their prices in order to influence demand for their products. C) As incomes rise, consumption rises. D) Firms cannot change their prices in order to influence demand for their products. End of Task. Worked Example:
Task #19 The circular flow of income and output is a model that features the following: A) The price a firm charges for its product or service influences the quantity it produces. B) When production costs increase, firms can raise prices without losing as many sales. C) As incomes rise, consumption rises. D) Firms cannot change their prices in order to influence demand for their products. Which of these statements are true? A),B),D). One sentence written per statement which includes one paragraph with three sentences each (total of nine sentences): – “As discussed earlier, when production costs increase, firms can raise prices without losing as many sales.” – “Income levels affect how much consumers will purchase at any given
