Refer to the table below. If demand increased by 100 units at each price level, and the government set a price ceiling of $40, then there will be:
Answer the question based on the following supply and demand schedules in units per week for a product.
A. A shortage
B. A surplus
C. No shortage or surplus
D. Decrease in supply
C. No shortage or surplus
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Which of the following statements regarding a firm's long-run average total cost (LRATC) curve and its short-run average total cost (SRATC) curve is true?
A) The LRATC shows the lowest cost at which a firm is able to produce a given level of output when no inputs are fixed. B) The contribution of average fixed cost to LRATC is greater than its contribution to SRATC. C) The shape of the LRATC is affected by the law of diminishing returns. D) The SRATC, but not the LRATC, can be used by a firm's managers for planning.
If the typical firm in a perfectly competitive market is earning positive economic profits then which of the following would be expected to happen?
a. Firms will exit the market. b. New firms will enter the market. c. There will be neither entry nor exit in this market. d. There will soon be a depression in the market.
If a Mexican pension fund decides to purchase U.S. government bonds, what is the effect in the foreign-exchange market?
A. It will increase demand for U.S. dollars. B. It will decrease demand for U.S. dollars. C. It will increase supply of U.S. dollars. D. It will decrease supply of U.S. dollars.
Tomas increased his consumption of potato chips when the price of pistachios increased. For Tomas, potato chips and pistachios are
A) substitutes. B) both inferior goods. C) complements. D) both luxury goods.