Refer to Figure 3-8. The graph in this figure illustrates an initial competitive equilibrium in the market for motorcycles at the intersection of D1 and S1 (point A). If there is a surplus of motorcycles how will the equilibrium point change?
A) The equilibrium point will move from A to B.
B) There will be no change in the equilibrium point.
C) The equilibrium point will move from A to C.
D) The equilibrium point will move from A to E.
B
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Answer the following statement(s) true (T) or false (F)
1. Proponents of an environmentally adjusted measure of national income believe that environmental pollution linked to production should be recorded as a loss in the system of national accounts (SNA). 2. Improvements made to China’s environment in preparation for the Olympic Games in 2008 have been maintained and even enhanced over time. 3. The economic criteria concerned with minimizing resource use to achieve an objective is known as allocative efficiency. 4. Setting an air quality standard is an example of a command and control approach to improving the environment. 5. A tax imposed on emissions is an example of the market approach to pollution control.
An increase in demand is graphically represented as a
A) rightward shift of the demand curve. B) leftward shift of the demand curve. C) movement down and to the right on a demand curve. D) movement up and to the left on a demand curve.
Refer to the information below. What is the vertical intercept of the demand curve?
A small nation has three gasoline suppliers with a linear monthly market demand equal to: Q = 500,000 - 5P. Each firm's marginal cost (MC) and average total cost (ATC) curves are horizontal at $10,000 per month. A) 0.50 B) 100,000 C) 0.20 D) 500,000
Governments can most effectively encourage a firm to produce the efficient level of output of a good whose production causes a beneficial externality by
a. increasing the demand at every price for the good. b. subsidizing the production of the good. c. taxing the production of the good. d. imposing a price ceiling on the good.