Principles of Microeconomics, 7th Edition (MindTap Course List)
7th Edition
ISBN: 9781285165905
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Question
Chapter 7, Problem 6CQQ
To determine
The impact of producing higher than the equilibrium.
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Choose all statements that are true.
A.
The supply curve represents the behavior of sellers and the supply curve is a function that shows the quantity supplied at different prices.
B.
An increase in supply means that sellers are willing to sell more quantity at all prices.
C.
An increase in supply is seen as a SHIFT of the supply to the RIGHT.
D.
Producer surplus is the area above the supply curve and below the price.
E.
A supply curve can be read horizontally or vertically. The horizontal reading tells us how much suppliers are willing and able to sell at each price. The vertical reading tells us the minimum price at which suppliers will sell a given quantity.
F.
An increase in supply means that sellers are willing to accept a lower price for each quantity
If the price of a product is below the equilibrium price, the result will be
A. A shortage of the good.
B. A surplus of the good.
C. A decrease in the supply of the good.
D. An increase in the demand of the good.
Lesson 10 Question 7
Chapter 7 Solutions
Principles of Microeconomics, 7th Edition (MindTap Course List)
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- Question 9arrow_forwardGive typing answer with explanation and conclusion Explain carefully why, in a competitive market, a quantity less than the equilibrium quantity is inefficient.arrow_forwardConsider the market for bus travel, where equilibrium price and quantity is determined by demand and supply. If bus travel is an inferior good and there is an increase in income and at the same time, the government subsidises bus travel, which of the following will occur? (a) The equilibrium price and quantity will be lower. (b) The equilibrium quantity will be higher, but the impact on price will be unknown. (c) The equilibrium price will be lower, but the equilibrium quantity will be higher. (d) The equilibrium price will be lower, but the impact on quantity will be unknown.arrow_forward
- A competitive market will: A. achieve an equilibrium price. B. produce shortages. C. produce surpluses. D. create disorder.arrow_forwardAn increase in consumer income will cause a decrease in the demand for an inferior good. A.True B.Falsearrow_forwardWhich of the following is true of any market? a. The interaction of demand and supply determines the price and quantity in that market. b. There must be a supply of the item but not necessarily a demand for the item. c. Demand and supply are always equal for an item. d. There must be a demand for the item but not necessarily a supply of the item. e. The market will always be in equilibriumarrow_forward
- If the price of a good starts out below the equilibrium price without a price control, then (please choose all the answers that are correct) A. suppliers will supply less, pushing the price down B. consumers will compete to bid the price up C. suppliers will compete to bid the price up D. the market starts with a surplus of supply over demand E. consumers will demand more than the equilibrim quantityarrow_forwardsurplus is the difference between the maximum price a consumer is (or consumers are) willing to pay for a product and the actual [market] price. A. Producer B. Consumer C. Nonearrow_forwardResearchers find that drinking beer has positive health effects. What impact will this have on the price of beer and producer surplus? Select one: a. they both decrease b. the equilibrium market price increases, and producer surplus decreases c. they both increase d. the equilibrium market price decreases, and producer surplus increasesarrow_forward
- Chewing gum is considered an inferior good. What would happen to the equilibrium price and quantity of chewing gum if income increased and more firms started producing chewing gum? Equilibrium price will A. go up and equilibrium quantity will go up. B. be indeterminate and equilibrium quantity will go up. C. go up and equilibrium quantity will go down. D. go down and equilibrium quantity will be indeterminate.arrow_forward1. 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.arrow_forwardI only need help with part e and part f.arrow_forward
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