Increase And Decrease Flashcards, test questions and answers

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What is Increase And Decrease?

Increase and decrease are two phrases that describe a process of changing the amount or size of something. Increase refers to making the amount or size greater, while decrease means to make it smaller. In economics, these terms often refer to changes in prices, wages, or other economic variables.In business, increases and decreases can refer to changes in production levels or price changes for goods and services. When companies increase production, they are able to produce more goods and services than before, which can lead to lower prices for consumers. Alternatively, when production is decreased then this usually results in higher prices for consumers. Increases and decreases also affect wages; when a company increases its wages it will attract more workers into their labor force as wages become more attractive. Companies that decide to reduce their wages may face labor shortages as workers look elsewhere for better pay opportunities.Increases and decreases play an important role in the fluctuation of markets and economies over time too; if demand for a product increases then this can drive up its price until supply catches up with demand again. Similarly if demand drops then so too will the cost of that product until there is an equilibrium between supply and demand once again. Increases and decreases also determine interest rates on certain investments; when an investor expects higher returns they may be willing to accept riskier investments with higher interest rates while investors expecting less return will invest their money into safer investments with lower interest rates instead. This helps keep markets balanced by providing incentives based on expected return on investment versus risk taken on by investors themselves.