When a market is in equilibrium:
A. both excess demand and excess supply are positive.
B. there is neither excess demand nor excess supply.
C. both excess demand and excess supply are positive and equal to each other.
D. there is either excess demand or excess supply.
Answer: B
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As the market price of a service increases, more potential sellers will decide to perform that service because:
A. more potential sellers will find that the market price exceeds their reservation price. B. higher prices result in higher revenue. C. it's more prestigious to produce high-priced services. D. higher prices lead to lower opportunity costs.
In the Solow model, if k = 8, y = 20, and s = 0.2, what is c?
A) 24 B) 20 C) 16 D) 12
Which of the following policies would Keynes's followers support when an increase in business optimism shifts the aggregate demand curve away from long-run equilibrium?
a. increase taxes b. increase government expenditures c. increase the money supply d. All of the above are correct.
Suppose the U.S. government imposes a $0.40 per pound tariff on rice imports. The figure to the right shows the impact of this tariff. With the tariff in place, the United States produces
A. 25 million pounds of rice B. 10 million pounds of rice C. 31 million pounds of rice D. 15 million pounds of rice