1. A market price that occurs below equilibrium price will cause A. a surplus of the good in the marketplace. B. a greater quantity demanded than at market equilibrium. C. will cause firms to supply additional units into the marketplace (relative to equilibrium price). D. all of the above. E. none of the above. 2. Here are three things that you could do if you do not attend your next-door neighbor's barbecue: watch television with some friends (you value this at $8), read a good novel (you value this at $4), or go in to work (you could earn $6 during the barbecue). The opportunity cost of going to your neighbor's barbecue is A. $6, because this is the only alternative of the three where you actually receive a monetary payment. B. $4, because this is the lowest dollar figure. C. $8, because this is the highest valued alternative forfeited. D. $18, because this is the total dollar sum of all the alternatives forfeited.
1. A market price that occurs below equilibrium price will cause A. a surplus of the good in the marketplace. B. a greater quantity demanded than at market equilibrium. C. will cause firms to supply additional units into the marketplace (relative to equilibrium price). D. all of the above. E. none of the above. 2. Here are three things that you could do if you do not attend your next-door neighbor's barbecue: watch television with some friends (you value this at $8), read a good novel (you value this at $4), or go in to work (you could earn $6 during the barbecue). The opportunity cost of going to your neighbor's barbecue is A. $6, because this is the only alternative of the three where you actually receive a monetary payment. B. $4, because this is the lowest dollar figure. C. $8, because this is the highest valued alternative forfeited. D. $18, because this is the total dollar sum of all the alternatives forfeited.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
1. A market
A. a surplus of the good in the marketplace.
B. a greater quantity demanded than at market equilibrium .
C. will cause firms to supply additional units into the marketplace (relative to equilibrium price).
D. all of the above.
E. none of the above.
2. Here are three things that you could do if you do not attend your next-door neighbor's barbecue: watch television with some friends (you value this at $8), read a good novel (you value this at $4), or go in to work (you could earn $6 during the barbecue). The
A. $6, because this is the only alternative of the three where you actually receive a monetary payment.
B. $4, because this is the lowest dollar figure.
C. $8, because this is the highest valued alternative forfeited.
D. $18, because this is the total dollar sum of all the alternatives forfeited.
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Market Equilibrium occurs when at market price, quantity demanded is equal to quantity supplied.
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