A surplus occurs in a market when:
A) demand exceeds supply.
B) price is lower than the equilibrium price.
C) price is higher than the equilibrium price.
D) the marginal cost of production is negligible.
C
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If prices have decreased since the base period, then
A) real GDP is smaller than nominal GDP. B) real GDP is larger than nominal GDP. C) real GDP is equal to nominal GDP. D) there is no way to adjust nominal GDP so that it equals real GDP. E) real GDP can no longer be compared to nominal GDP.
Liz loves to eat popcorn. Still, the more she eats, the less she wants each additional bite. Her marginal utility from popcorn is
A) diminishing. B) negative. C) increasing. D) zero.
Lou buys a Star Wars: The Force Awakens poster at a garage sale for $30 and resells it on eBay to Kyle for $60. Which of the following statements is true?
A) The transaction is economically inefficient. B) The transaction has made Lou and Kyle better off. C) The transaction has made Lou better off and Kyle worse off. D) It is not possible for Kyle to enjoy any consumer surplus from this transaction.
A Cobb-Douglas production function:
A) exhibits constant returns to scale. B) exhibits increasing returns to scale. C) exhibits decreasing returns to scale. D) can exhibit constant, increasing, or decreasing returns to scale.