When the electronics retailer Circuit City closed its stores following the 2008 recession, the market supply of electronic goods:
A) decreased, causing the market price to fall.
B) decreased, causing the market price to rise.
C) increased, causing the market price to fall.
D) increased, causing the market price to rise.

Question

Quizplus · Accepted Answer

When Circuit City closed, the supply of electronic goods in the market decreased because there were fewer retailers selling these goods. A decrease in supply typically leads to an increase in market prices, assuming demand remains constant.

When the Electronics Retailer Circuit City Closed Its Stores Following