6
QuizMultiple Choice

The Law of Supply — Quiz

Question 6 • Economics

When prices for homes rise, why might construction companies decide to build more homes?

Answer
A
to make a profit
B
to increase employment
C
to boost name recognition
D
to create a need for more resources

Explanation

Higher home prices can make building and selling homes more profitable. If companies expect the sale price to exceed their construction costs by a larger amount, they have an incentive to build more homes. The best answer is “to make a profit.”

AI-written and checked against the verified answer.

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