In a competitive market, the market demand is Qd = 60 - 6P and the market supply is Qs = 4P. A price floor of $9 will result in a
A. shortage of 12 units.
B. surplus of 12 units.
C. shortage of 30 units.
D. surplus of 30 units.
Answer: D
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The primary purpose of deposit insurance is to
A) improve the flow of information to investors. B) prevent banking panics. C) protect bank shareholders against losses. D) protect bank employees from unemployment.
In a market characterized by a single seller and many buyers, a seller's investment to reduce transaction costs can lead to which of the following situations?
a. It can reduce producer surplus in the long run. b. It can raise the price paid by customers and still make them better off. c. It can decrease the brand value of the product. d. It can lower the quality of the product in the long run.
Fiscal stimulus is most likely to direct resources into productive projects when spending decisions are left in the hands of
What will be an ideal response?
Gasoline stations carrying the same fuel brand (e.g., Chevron) are able to charge different prices in San Francisco because:
A. location is a source for product differentiation. B. gasoline stations are perfect price discriminators. C. gasoline station operators form a cartel to act as a monopoly. D. fuel quality varies across stores.