Homework Answers
If price is above equilibrium, then at that price level, quantity supplied exceeds quantity demanded and this will cause surplus. When surplus exists, then sellers must decrease price in order to attract additional quantity demanded and to reduce quantity supplied. Thus surplus will be eliminated.
If price is below equilibrium, then it causes a shortage as quantity demanded exceeds quantity supplied. When there is shortage, sellers must increase price to reduce quantity demanded and entice sellers to produce more.
Answer: option A
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At any price above or below the equilibrium price: sellers face an incentive to raise or...
Which of the following is NOT a characteristic of a market in equilibrium? Multiple Choice Sellers...
Which of the following is NOT a characteristic of a market in equilibrium? Multiple Choice Sellers can sell as many units as they want at the equilibrium price. Neither buyers nor sellers want the price to change. There s There is neither excess supply nor excess demand. Buyers can buy as many units as they want at the equilibrium price.
A tax imposed on the sellers of a good will a. raise both the price buyers...
A tax imposed on the sellers of a good will a. raise both the price buyers pay and the effective price sellers receive. b. raise the price buyers pay and lower the effective price sellers receive. c. lower the price buyers pay and raise the effective price sellers receive. d. lower both the price buyers pay and the effective price sellers receive. Part B. When studying how some event or policy affects a market, elasticity provides information on the a....
At prices above or below the market equilibrium price: more trades take place, because many more...
At prices above or below the market equilibrium price: more trades take place, because many more people are willing to buy or sell. the market will not function. goods are not traded. fewer trades take place, because some people are no longer willing to buy or sell.
Refer to the table above. If the market is originally in equilibrium and a price ceiling...
Refer to the table above. If the market is originally in
equilibrium and a price ceiling of $50 is imposed, which of the
following is incorrect?
A. Net surplus in the economy will decrease
B. Producer surplus will decrease
C. Supply will decrease
D. Consumers will purchase less than they would at the
equilibrium price
E. Producers will sell less than they would at the equilibrium
price
Supply P* Gi Demand Qd Qs Quantity
O There is incentive for firms to collude. QUESTION 9 What best describes a demand schedule?...
O There is incentive for firms to collude. QUESTION 9 What best describes a demand schedule? A table showing how much of a good consumers will buy at different prices. o A timetable showing when purchases will be made.. A table showing how much of a good producers will sell at different prices. O A timetable of household expenditures. QUESTION 10
22. When the price of a good changes, the amount of that good that buyers wish...
22. When the price of a good changes, the amount of that good that buyers wish to buy changes: solely because of the substitution effect. solely because of the income effect. because of both the substitution and the income effects. only if the substitution effect and the income effect do not cancel out each other. QUESTION 23 Which of the following is NOT a characteristic of a market in equilibrium? There is neither excess supply nor excess demand. Neither buyers...
Price dispersion is measured as the distribution of prices for the same product/service across sellers at...
Price dispersion is measured as the distribution of prices for the same product/service across sellers at a given point in time. Lower dispersion means that prices across sellers at a point in time are more similar to each other, i.e., there is less variability in pricing. Price dispersion is thought to be a good measure of information efficiency in a market. For example, when search costs for consumers are low (and consumers can easily compare competitive offers), price dispersion is...
In the above figure, the imposition of a $0.25 sales tax on sellers will
In the above figure, the imposition of a $0.25 sales tax on sellers will A) lower the market price paid by buyers of hotdogs by $0.25. B) raise the market price paid by buyers of hotdogs by $0.25. C) raise the market price paid by buyers of hotdogs by $0.125. D) have no effect on the market price of hot dogs.
1. When will a minimum wage be an effective price control? When it is a... A....
1. When will a minimum wage be an effective price control? When it is a... A. Maximum "price" that is above the equilibrium price B. Maximum "price" that is below the equilibrium price C. Minimum "price that is above equilibrium price 2. Many major U.S. cities have adopted rent controls for some housing. An effective rent control is what kind of price control? A. A price ceiling with a maximum price above equilibrium price. B. A price floor with a...
Which of the following does not describe how the allocating function of price determines long-run equilibrium...
Which of the following does not describe how the allocating function of price determines long-run equilibrium quantity? The change in market price provides an incentive for consumers to change their quantity of consumption and for producers to redistribute their resources. Producers respond to an increase in demand by allocating a greater amount of resources to production due to the increased profitability of the product. Consumers respond to an increase in supply by substituting away from other goods due to the...
Which of the following is NOT a characteristic of a market in equilibrium? Multiple Choice Sellers can sell as many units as they want at the equilibrium price. Neither buyers nor sellers want the price to change. There s There is neither excess supply nor excess demand. Buyers can buy as many units as they want at the equilibrium price.
Refer to the table above. If the market is originally in
equilibrium and a price ceiling of $50 is imposed, which of the
following is incorrect?
A. Net surplus in the economy will decrease
B. Producer surplus will decrease
C. Supply will decrease
D. Consumers will purchase less than they would at the
equilibrium price
E. Producers will sell less than they would at the equilibrium
price
Supply P* Gi Demand Qd Qs Quantity
O There is incentive for firms to collude. QUESTION 9 What best describes a demand schedule? A table showing how much of a good consumers will buy at different prices. o A timetable showing when purchases will be made.. A table showing how much of a good producers will sell at different prices. O A timetable of household expenditures. QUESTION 10
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