Economic theory asserts that manufacturers are willing to sell fewer units of output as the price of a good decreases, ceteris paribus. However, as the price of computers decreased throughout the 1990s, more computers were sold. Which of the following best explains the apparentconflict between theory and data
A) The theory must be invalid.
B) The theory was based on assumptions that were too simplistic.
C) It is likely that variables other than the price and the quantity of computers sold had changed
D) All variables other than the price and the quantity of computers sold were unchanged.
E) The empirical evidence gathered to support the theory was manipulated.
Correct Answer:
Verified
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