Suppose an economist says that "other things equal, the lower the price of bananas, the greater the amount of bananas purchased." This statement indicates that:A. the quantity of bananas purchased determines the price of bananas. B. all factors other than the price of bananas (for example, consumer tastes and incomes) are assumed to be constant. C. economists can conduct controlled laboratory experiments. D. one cannot generalize about the relationship between the price of bananas and the quantity purchased.

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Business

Rowan Archer

5 September, 16:49

Suppose an economist says that "other things equal, the lower the price of bananas, the greater the amount of bananas purchased." This statement indicates that:A. the quantity of bananas purchased determines the price of bananas. B. all factors other than the price of bananas (for example, consumer tastes and incomes) are assumed to be constant. C. economists can conduct controlled laboratory experiments. D. one cannot generalize about the relationship between the price of bananas and the quantity purchased.

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Romeo Sims · Answer 1

Answer: This statement indicates that: "B. all factors other than the price of bananas (for example, consumer tastes and incomes) are assumed to be constant. ".

Explanation: This is the ceteris paribus principle: In economics and finance, the term Ceteris Paribus is used as an abbreviation to indicate the effect of one economic variable on another, keeping constant all other variables that could affect it.