AP Macroeconomics Question 93: Answer and Explanation
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7. If firms that make a particular product expect its price will be lower in the future,
- A. this will cause the supply of the product to increase right now.
- B. this will cause the supply of the product to decrease right now.
- C. this will have no effect on the amount of the product supplied right now.
- D. this will have no effect on the supply of the product now or later.
- E. this will cause consumers to expect the price to be higher in the near future also.
Correct Answer: A