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Which of the Following Statements Best Illustrates the Fallacy of Composition

Question 66

Multiple Choice

Which of the following statements best illustrates the fallacy of composition?


A) If the price of a product increases, the quantity of the product supplied will decline, ceteris paribus.
B) The average wage rate tends to increase at approximately the same rate as inflation; hence, wage increases must cause inflation.
C) Resources are scarce; therefore, there is no such thing as a free lunch.
D) If I talk loudly at a party, I have a better chance of being heard by my listeners; if everyone at the party talks loudly, everyone can be heard more clearly.
E) If the price of a product increases, the quantity of the product supplied will increase, ceteris paribus.

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