121.If producers incorrectly set the price of their product too high:
A. a shortage will result.
B. a surplus will result.
C. equilibrium will result.
D. the industry will soon die out.
122.If producers incorrectly set the price of their product too low:
A. a shortage will result.
B. a surplus will result.
C. equilibrium will result.
D. the industry will soon die out.
123.If producers incorrectly set the price of their product too high:
A. a shortage will result and consumers will bid the price down to equilibrium.
B. a surplus will result and excess goods in inventory will signal the producers to lower their prices.
C. a shortage will result and consumers will bid the price up to equilibrium.
D. a surplus will result and excess goods in inventory will signal the producers to restrict output. until sales increase.
124.If producers incorrectly set the price of their product too low:
A. a shortage will result and consumers will bid the price down to equilibrium.
B. a surplus will result and excess goods in inventory will signal the producers to lower their prices.
C. a shortage will result and consumers will bid the price up to equilibrium.
D. a surplus will result and excess goods in inventory will signal the producers to restrict output until sales increase.
125.Consider a market that is in equilibrium. If it experiences an increase in demand, what will happen?
A. The demand curve will shift to the right, and the equilibrium price and quantity will rise.
B. The demand curve will shift to the right, and the equilibrium price will increase and the equilibrium quantity will decrease.
C. The demand curve will shift to the right, and the equilibrium price and quantity will fall.
D. The demand curve will shift to the left, and the equilibrium price and quantity will fall.
126.Consider a market that is in equilibrium. If it experiences a decrease in demand, what will happen?
A. The demand curve will shift to the left, and the equilibrium price and quantity will rise.
B. The demand curve will shift to the left, and the equilibrium price will increase and the equilibrium quantity will decrease.
C. The demand curve will shift to the left, and the equilibrium price and quantity will fall.
D. The demand curve will shift to the right, and the equilibrium price and quantity will fall.
127.Consider a market that is in equilibrium. If it experiences a decrease in supply, what will happen?
A. The supply curve will shift to the left and the equilibrium price and quantity will rise.
B. The supply curve will shift to the left and the equilibrium price will increase and the equilibrium quantity will decrease.
C. The supply curve will shift to the left and the equilibrium price and quantity will fall.
D. The supply curve will shift to the right and the equilibrium price and quantity will fall.
128.Consider a market that is in equilibrium. If it experiences an increase in supply, what will happen?
A. The supply curve will shift to the right and the equilibrium price and quantity will rise.
B. The supply curve will shift to the right and the equilibrium price will decrease and the equilibrium quantity will increase.
C. The supply curve will shift to the right and the equilibrium price and quantity will fall.
D. The supply curve will shift to the left and the equilibrium price and quantity will fall.
129.Consider a market that is in equilibrium. If it experiences both an increase in demand and an increase in supply, what can be said of the new equilibrium?
A. The equilibrium price and quantity will both rise.
B. The equilibrium quantity will definitely rise, while the equilibrium price cannot be predicted.
C. The equilibrium price will definitely rise, while the equilibrium quantity cannot be predicted.
D. The equilibrium price and quantity will both fall.
130.Consider a market that is in equilibrium. If it experiences both a decrease in demand and a decrease in supply, what can be said of the new equilibrium?
A. The equilibrium price and quantity will both fall.
B. The equilibrium quantity will definitely fall, while the equilibrium price cannot be predicted.
C. The equilibrium price will definitely fall, while the equilibrium quantity cannot be predicted.
D. The equilibrium price and quantity will both rise.
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