There is an increase in demand for personal computers at the same time their input costs fall. What can we expect?

Question

Quizplus · Accepted Answer

When input costs fall, the price of personal computers is likely to fall. This will result in an increase in the quantity sold as demand for personal computers has also increased. Therefore, we can expect the quantity sold to increase, but the effect on price is uncertain as it depends on how much competition exists in the market.

There Is an Increase in Demand for Personal Computers at the Same