Price ceilings are never binding when set above the equilibrium price
a. True
b. False
Indicate whether the statement is true or false
True
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When the market price of a product is below the equilibrium price, shortages will result and sellers can be expected to reduce the supply of that product
a. True b. False Indicate whether the statement is true or false
How does the long-run industry supply curve compare to the short-run industry supply curve?
a. The long-run curve is always flatter than the short-run curve. b. The long-run curve is always steeper than the short-run curve. c. The long-run curve is based on the assumption that firms can control the price they charge, whereas the short-run curve assumes that the market sets the price. d. The short-run curve is based on the assumption that firms can control the price they charge, whereas the long-run curve assumes that the market sets the price.
Suppose a price floor is imposed on eggs above their equilibrium price. The likely result will be:
A. a higher equilibrium price for eggs as the supply curve for eggs shifts left. B. a lower equilibrium price for eggs as the demand curve for eggs shifts left. C. a decrease in the quantity of eggs demanded. D. an increase in the quantity of eggs demanded.
Refer to the information provided in Figure 6.5 below to answer the question(s) that follow.
Figure 6.5Refer to Figure 6.5. Molly's budget constraint is EF. If her income decreases while the price of the goods are unchanged, her new budget constraint could be
A. CD. B. BD. C. AD. D. Her new possible budget constraint is not shown on this graph.