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4 February, 08:13

If a manufacturing plant that employs 20% of the local labor force closes, the likely effect on the area’s real estate values will reflect the principle of?

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  1. 4 February, 08:23
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    Supply and demand

    Explanation:

    First is important to remember the supply and demand principle. We can analyze this by the law of supply and demand.

    The law of supply states that "the quantity of a good supplied rises as the market price rises, and falls as the price falls".

    Conversely, the law of demand says that "the quantity of a good demanded falls as the price rises, and the quantity of a good increase as the price decrease".

    For this case if the manufacturing plant close 20% of the people in the area will not have a job and the prices of the real state values will tend to decrease and if the prices decrease the quantity falls from the supply law.
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