Refer to the diagram below for the milk market. There would be a shortage of milk whenever the price is:
A. Higher than $1.50 per gallon
B. Higher than $2.00 per gallon
C. Lower than $1.50 per gallon
D. Lower than $2.00 per gallon
Answer: C
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Each of the following factors might interfere with the efficiency of perfect competition except:
a. increasing returns to scale. b. imperfect price information. c. externalities. d. diminishing returns to scale.
A price ceiling set below the equilibrium price causes quantity demanded to exceed quantity supplied
a. True b. False Indicate whether the statement is true or false
An economically efficient method of production produces a given level of output at the lowest possible cost.
Answer the following statement true (T) or false (F)
Sarah spends $100 a year on magazines and ice cream. The table above shows her utility from each good. If the price of a magazine is $5 and the price of ice cream is $5 per gallon, how does Sarah spend the $100?
What will be an ideal response?