In a given market, how are the equilibrium price and the market-clearing price related?
a. There is no relationship.
b. They are the same price.
c. The market-clearing price exceeds the equilibrium price.
d. The equilibrium price exceeds the market-clearing price.
b
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Which of the following would understate the consumer price index?
a. Substitution bias. b. Deteriorating quality of products. c. Improving quality of products. d. Law of demand bias.
Economic theory assumes that voters, politicians, and other political participants are largely motivated by
a. personal self-interest. b. altruism. c. a desire to promote the general welfare. d. a desire to promote allocative economic efficiency.
Which of the following is associated with peaks in the business cycle?
a. High unemployment b. Recessions c. Low unemployment d. Depression
How does the market for insurance promote economy growth and investment?
Please provide the best answer for the statement.