Question

36)If the price of sugar rises whilst the quantity of sugar traded falls, then it is likely that:
Select one:
a. The demand for sugar has fallen
b. The supply of sugar has fallen
c. The supply of sugar has increased
d. The demand for sugar has increased​

Answer 1

Answer :

A. The demand for sugar has fallen

Explanation :

• a. The demand for sugar has fallen is the correct answer.

When the price of a good or service increases, and the quantity traded falls, it is an indication of a decrease in demand. This is because as the price increases, the quantity demanded by consumers will decrease as they are less willing or able to pay the higher price. The relationship between price and quantity demanded is captured by the law of demand, which states that as the price of a good or service increases, the quantity demanded will decrease (other things being equal).

• b. The supply of sugar has fallen is incorrect. If the supply of sugar falls, it means the quantity of sugar available to be sold decreases. In this case, the decrease in quantity traded is due to a decrease in demand, not the decrease in supply.

• c. The supply of sugar has increased is incorrect. If the supply of sugar increases, it means the quantity of sugar available to be sold increases. In this case, the decrease in quantity traded is due to a decrease in demand, not an increase in supply.

• d. The demand for sugar has increased is incorrect. As stated earlier, if the price of sugar rises whilst the quantity of sugar traded falls, it is an indication that the demand for sugar has fallen.

In summary, a decrease in quantity traded and an increase in price of sugar indicate a fall in the demand of sugar, as consumers are less willing to purchase it at the higher price.

To know more about the concept please go through the links :

https://brainly.in/question/40917976

https://brainly.in/question/19329768

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