SOLVED

11) If the market price falls from P0 to P1 in the above figure, then A) a new equilibrium quantity is established. B) there is a shortage equal to the distance EF. C) there will be a further tendency for price to fall. D) there is a surplus of goods on the market equal to the distance Q1, Q2. 12) If the market price rises from P0 to P2 in the above figure, then there is a A) surplus equal to the distance Q0, Q2. B) surplus equal to the distance Q1, Q2. C) shortage equal to the distance Q0, Q2. D) shortage equal to the distance Q1, Q2. 13) Refer to the above figure. The highest price that consumers would be willing to pay for quantity Q2 is A) P2. B) P0. C) P1. D) cannot be determined from the diagram. 14) Refer to the above figure. Other things being equal, if price is at P2 , then we would expect A) price to decline until an equilibrium is achieved at P0. B) consumers to reduce their offering price for the good. C) an excess quantity demanded to occur. D) consumers to bid against each other for goods and force the price still higher. Â Â 15) According to the above table, at a price of $8 per unit, other things constant, A) consumers will continue to bid prices upward. B) there will be no tendency for the market to approach an equilibrium. C) a surplus of 100 units will exist. D) a shortage of 80 units will exist. 16) According to the market data for good X in the above table, a stable equilibrium price is established at A) $2. B) $4. C) $6. D) $8. 17) Given the market data for good X in the above table, an equilibrium quantity is established at A) 90 units. B) 60 units. C) 30 units. D) 120 units. 18) In any given market, prices are determined by A) specialization of labor. B) transactions costs. C) supply and demand. D) comparative advantage. 19) The equilibrium or market clearing price occurs at the point at which A) quantity demanded equals quantity supplied. B) the supply curve intersects the horizontal axis. C) the demand curve intersects the vertical axis. D) there is a shortage of the desired good. 20) According to the above figure, a shortage is shown between which two points? A) A and E B) C and B C) A and B D) E and F