n which situation would the price of a good be most likely to increase?

Question

Responses

There's a sudden increase in the number of companies competing to sell the good.

There's a sudden increase in the number of companies competing to sell the good.

An increase in production costs results from a rise in wages.

An increase in production costs results from a rise in wages.

A breakthrough in productive technology enables a company to increase its output.

A breakthrough in productive technology enables a company to increase its output.

A rise in demand happens too quickly for producers to increase production to keep up.

Answer 1

The situation in which the price of a good would be most likely to increase is:

A rise in demand happens too quickly for producers to increase production to keep up.

In this scenario, demand outstrips supply, leading to higher prices as consumers compete to purchase the limited available quantity. The other scenarios either suggest increased competition (which tends to drive prices down), improvements in production efficiency (which can lower costs and prices), or an increase in production costs that may not immediately lead to higher prices if demand is stable.