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FP&A Exam Preparation Blog

FP&A Friday: Chapter 10 - Microeconomics

Aug 31, 2018

Join us as we review the FP&A Learning System in our weekly VLOG. This week, let's go through Chapter 10 - Microeconomics.



This week's question is:


A manufacturer of smartphones is selling its current most popular model at $350. However, a competitor has just introduced a new model with improved features at a matching price. What effect is that likely to have on the current model?

   A. It may shift the demand curve downward, resulting in a lower equilibrium price
   B. It may shift the supply curve downward, resulting in a lower equilibrium price
   C. It may increase the income effect, resulting in a higher equilibrium price
   D. It may increase the current model’s income utility, resulting in a higher equilibrium price


Watch the video to find out how to determine the solution, and get the correct answer.

Stay tuned for next week's video on Chapter 11 - Managing FP&A Projects.

Want more FP&A Friday Videos? You can see them all here.