If the equilibrium price of gasoline is $2.75 per gallon and the government will not allow oil companies to charge more than $2.00 per gallon of gasoline, which of the following will happen?
A) Demand must eventually decrease so that the market will come into equilibrium at a price of $2.00.
B) Supply must eventually increase so that the market will come into equilibrium at a price of $2.00.
C) Total surplus in the market will be lower than it would be if the price was $2.75 per gallon.
D) The market will be in equilibrium at a price of $2.00.
Ans: C) Total surplus in the market will be lower than it would be if the price was $2.75 per gallon.
You might also like to view...
Generally, a stock dividend is declared to improve the marketability of the shares by reducing the market price per share, increasing the number of shares outstanding, and making it possible to have a wider ownership of the stock
a. True b. False Indicate whether the statement is true or false
A single question that attempts to cover two issues is called a double-barreled question
Indicate whether the statement is true or false
Which of the following transactions would not be reported on the statement of cash flows?
a. Purchase of treasury stock b. Declaration of a cash dividend which has not yet been paid c. Patent amortization d. Purchase of an operational asset by issuing common stock
Effective writing is a ____________ activity, not an oral/aural one
a. daunting b. secondary c. cerebral d. visual