The quantity of goods exchanged in a market will be below the equilibrium quantity
A. when the price is either held above or below the equilibrium price.
B. only when the price is held above the equilibrium price.
C. only when the price is held below the equilibrium price.
D. only when the price is rising.
Answer: A
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The Package Store hires workers to wrap packages. The store sells this service for $5. The marginal revenue product of this store's fifth worker is $50. The marginal product of the fifth worker is
A. 0.01 package. B. 1 package. C. 10 packages. D. indeterminate from this information.
Because warranties are potentially ________, low-quality goods are ________ to have warranties
A) very expensive; less likely B) inexpensive; less likely C) very expensive; more likely D) inexpensive; more likely
The Fed uses a "core" price index, one that excludes food and energy prices to measure inflation. It does so because
A) food and energy have inelastic demand curves and consumers will buy them regardless of their price. B) food and energy prices have wide swings that are not related to the causes of general inflation. C) food and energy prices do not change all that much during the short run, so are irrelevant to the calculation of inflation. D) it wants to avoid the blame for high gasoline prices causing inflation.
Economists do not think price discrimination is unfair because
A. people with higher incomes should pay higher prices than those with lower incomes. B. if the prices charged to some buyers get too high, those who are able to buy at lower prices will just resell their purchases to the people facing the high prices. C. economists are concerned with efficiency rather than fairness. D. more buyers are able to purchase the good with price discrimination, some buyers pay a lower price than if there were a single price, and sellers earn higher profit than if there were a single price.