If a price ceiling is set below the market equilibrium price, which of the following outcomes is most likely to occur? Group of answer choices A) A surplus of the good in the market B) An increase in the quantity supplied of the good C)A shortage of the good in the market D) The market will clear at the new price

If a price ceiling is set below the market equilibrium price, which of the following outcomes is most likely to occur? Group of answer choices A) A surplus of the good in the market B) An increase in the quantity supplied of the good C)A shortage of the good in the market D) The market will clear at the new price

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter3: Market Demand And Supply

Section: Chapter Questions

Problem 8SQ

See similar textbooks

Similar questions

Which of the following would not cause market demand for a normal good to decline? a. An increase in the price of a substitute b. An increase in the price of a complement c. A decline in consumer income d. Consumer expectations that the good will go on sale in the near future e. An announcement by the Surgeon General that the product contributes to premature death
If, at the current price, there is a surplus of a good, then: A) the quantity demanded is greater than the quantity supplied. B) the market must be in equilibrium C) the price is above the equilibrium price D) Both A and C.
If a price ceiling of $7 is set, the quantity of soft drink to be exchanged will be 3. When a price ceiling is set below the equilibrium price, quantity demanded will exceed quantity supplied, and excess demand or shortages will result.
When a market has a surplus, the quantity demanded is greater than quantity supplied. Select one: True False
a) In the market for sugary drinks, the current equilibrium price is $10 and the equilibrium quantity is 30. The demand choke price is $50 and the supply choke price is $5 (a) Draw a demand and supply diagram, and shade the regions that represent consumer and producer welfare. Calculate the Total welfare in this market b) In this market, you now know that E D = −0.4 and E S = 1.2. Redraw your diagram in part (a) with the correct sloping curves. In this part you do not have to shade the welfare regions. All you need to do is redraw the diagram with the same equilibrium price and quantity, and choke prices but adjust the slope of each curve to reflect their respective elasticity c) If a tax was to be implemented in this market, what percentage of the burden is borne by the buyer? d) The government plans to discourage the consumption of sugary drinks and as such, they implemented a $1 tax on every bottle produced. In this situation, the suppliers are taxed directly but they hope to pass…
Consider a market where the equilibrium price for a good is $17 and the equilibrium quantity is 350 units. Assume that the quantity supplied at an above - equilibrium price is 5 times the equilibrium quantity, and the quantity demanded at the above - equilibrium price is 1/3 the equilibrium quantity. Calculate the surplus in the market at the above - equilibrium price. If necessary, round any intermediate calculations to one decimal place and your final answer to the nearest whole number.
True or false. There is no surplus or shortage when there is an equilibrium in the market.
A rise in the price of a substitute in production for a good leads to A) an increase in the supply of that good. B) no change in the supply of that good; instead there is a change in the quantity supplied. C) a decrease in the quantity of that good supplied. D) no change in either the supply or the quantity supplied of the good. E) a decrease in the supply of that good.
Setting a price ceiling below the equilibrium price will result in: Question 10 options: A) a shortage, where the quantity supplied exceeds the quantity demanded. B) no impact on the quantity demanded or on the quantity supplied. C) a surplus, where the quantity supplied exceeds the quantity demanded. D) a shortage, where the quantity demanded exceeds the quantity supplied.
When an economist states the supply of a product has decreased, he or she has concluded that a) A smaller quantity will be produced at every price b) The price is too high for equilibrium c)a greater quanity will produced at every price d) the price is too low equilibrium. e) demand was too high for producers to make a profit.
Consider two markets: the market for coffee and the market for hot cocoa. The initial equilibrium for both markets is the same, the equilibrium price is $6.50$⁢6.50, and the equilibrium quantity is 39.039.0. When the price is $9.75$9.75, the quantity supplied of coffee is 71.071.0 and the quantity supplied of hot cocoa is 105.0105.0. For simplicity of analysis, the demand for both goods is the same. Using the midpoint formula, calculate the elasticity of supply for hot cocoa. Please round to two decimal places. Supply in the market for coffee is more elastic than supply in the market for hot cocoa. There is not enough information to tell which has a higher elasticity. the same elasticity as supply in the market for hot cocoa. less elastic than supply in the market for hot cocoa.
QUESTION 15 Consider a market where supply and demand are given by Qx = -10 + Px and Qxd=56-2 Px. What is the equilibrium price?