Question

Because a producer does not have time to respond to a change in demand during the immediate market period, what happens?

1) The producer adjusts the price to match the new demand
2) The producer increases production to meet the new demand
3) The producer decreases production to match the new demand
4) The producer ignores the change in demand

Answer 1

In the immediate market period, a producer does not have time to respond to a change in demand. Therefore, the producer ignores the change in demand.

Step-by-step explanation:

In the immediate market period, a producer does not have enough time to respond to a change in demand. Since the producer cannot adjust prices or production immediately, option 4) The producer ignores the change in demand is the most accurate choice. In this period, the producer is unable to make any adjustments to meet the new demand.