Consider the nation of Wetland. In every year for the last five years, those who produced swords can sell more of their swords at lower prices. We could explain this as:
A. An exception to the law of supply and demand.
B. In terms of an increasing demand and decreasing supply.
C. By constant annual increases in supply accompanied by large annual increases in demand.
D. In terms of a strong supply curve and increasing demand.
E. All the other answers are incorrect.
B. In terms of an increasing demand and decreasing supply.
The correct answer is B. In terms of an increasing demand and decreasing supply.
The fact that those who produced swords in Wetland can sell more swords at lower prices over the last five years suggests an increasing demand for swords. This means that there is a growing desire or need for swords in the market. At the same time, the decreasing supply of swords indicates that the number of sword producers or the quantity of swords being produced has been reducing.
Therefore, the phenomenon can be explained as an increasing demand for swords coupled with a decreasing supply, resulting in sword producers being able to sell more swords at lower prices. Option B accurately describes this scenario.