Question

When the price of cotton goes up which of the

following is the result?
A Production and exports decrease.
B. Production and exports increase.
C. Production increases while exports decrease.
D. Production decreases while exports increas

Answer 1

A. Production and exports decrease.

Step-by-step explanation:

With the increase in price, the supply decreases and the quantity exported also decreases.

According to the law of demand, with the increase in the demand, the price falls and with the decrease in demand, the price rises. The relationship between the price and the quantity demanded is inverse in nature. When the price falls, the export of the product increases. In the given situation, the increase in price of the cotton results in the decrease in the production and the export.