At a price of $2,000 per unit,the demand for Rancho 60 mountain bikes from Cloyd's Inc.is 300 units,which is the number of bikes they manufacture every year.If the marketing managers at Cloyd's Inc.decide to sell each bike at a price lower than $2,000 per unit,_____.
A) a shortage of bikes will be created
B) the number of bikes produced will increase drastically
C) an inelastic demand for the bikes will be created
D) the demand for and the supply of the bikes will attain equilibrium

Question

Quizplus · Accepted Answer

Lowering the price below $2,000 will increase demand, potentially exceeding the supply of 300 units, creating a shortage.

At a Price of $2,000 Per Unit,the Demand for Rancho