Assume that the cost of aluminum used by soft-drink companies increases. Indicate which of the following statements describing the resulting effects in the market for soft drinks distributed in aluminum cans are true (T) or false (F).

The correct answer is: I. The demand for soft drinks decreases.

II. The quantity of soft drinks demanded decreases.

Explanation:

Production costs are a variable that can be controlled by the company, so that if for some reason sales decrease, it is necessary to decrease sales prices, or raw material costs rise, the only factor on the That the company has more control are the production costs.