Suppose you want to buy a popular brand of digital camera. Every store in town is out of stock. You are willing and able to pay the current market price of $300 for a camera, but you cannot find any available
Is the market for the digital camera in equilibrium? If not, is the market equilibrium price of the camera above or below $300? Use supply and demand analysis to explain your answer.
No, the market for the digital camera is not currently in equilibrium because there is a shortage of the camera at the current price of $300 . This implies that the market equilibrium price is greater than $300 .
You might also like to view...
All of the following statements about marginal benefit are correct EXCEPT the marginal benefit of a good
A) is the benefit a person receives from consuming one more unit of the good or service. B) is measured as the maximum amount that a person is willing to pay for one more unit of the good. C) is equal to zero when resource use is efficient. D) decreases as the quantity consumed of the good increases.
Hyperinflation occurs when
A) the inflation rate rises. B) the inflation rate declines. C) the inflation rate is extremely high. D) the inflation rate is extremely low.
If a firm responded to a decrease in demand for its product by cutting its price to increase sales, but then all firms experienced a decrease in demand for their products, sticky prices in the aggregate would prevent aggregate demand from rebounding. This is an example of
a. a macroeconomic externality. b. the Expenditure-Output model. c. the expenditure multiplier. d. the coordination argument.
According to EPA estimates, compliance with pollution-control regulations cost U.S. producers and consumers more than what amount in 2012?
a. $100 billion b. $200 billion c. $300 billion d. $400 billion