Principles of Macroeconomics (MindTap Course List)
8th Edition
ISBN: 9781305971509
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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Students have asked these similar questions
Why is equilibrium the
best guideline for
pricing a product?
A. It is the best way to set the
price without knowing the
market demand.
B. It is the only way to know for
certain that you will not end up
with a surplus of product.
C. It is a number-based
agreement between customer
and producer to set price versus
demand.
The government extend assistance to business who had been compliant and diligent in paying taxes to the government. This is a big help to the business operations, particularly to their cost of production. How will it affect the pricing decision of these businesses
a. Businesses can lower the selling price of their products or service
b. Businesses can increase the selling price of their products or services
c. Businesses can freeze the price and still can earn profit
d. Businesses pricing decisions will not be affected at all
A production function measures the relation between
a. Input prices and output prices
b. Input prices and the quantity of output
c. The quantity of inputs and quantity of outputs
d. The quantity of inputs and input prices
Buyers as a group determine supply, and sellers as a group determine the demand of the product
a.
True
b.
False
Chapter 7 Solutions
Principles of Macroeconomics (MindTap Course List)
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Similar questions
- 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_forwardA. Assume a market of a specific good. The demand and supply equation is as shown below: Pp = 70 – 3Qp Ps = 5+ 20s Assume that there is an advancement in technology that causes the input cost of the good to decrease. Thi cause the supply curve to shift rightwards by 2 units. 1. Find the new demand price elasticities at the equilibrium 2. Find the new supply price elasticities at the equilibrium 3. Find the new Consumer Surplus 4. Find the new Producer Surplusarrow_forwardCalculate the consumer surplus at the market equilibrium price. Calculate the producer surplus at the market equilibruim price. Calculate the total surplus at the market equilibruim price. At what price will the total surplus be maximized in this market. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.arrow_forward
- When consumers face rising gasoline prices, they typically A. reduce their quantity demanded more in the short run than in the long run.B. reduce their quantity demanded more in the long run than in the short run.C. do not reduce their quantity demanded in the short run or the long run.D. increase their quantity demanded in the short run but reduce their quantity demanded in the long run.E. None of the above .arrow_forwardChoose 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 quantityarrow_forwardProducing a quantity larger than the equilibriumof supply and demand is inefficient because themarginal buyer’s willingness to pay isa. negative.b. zero.c. positive but less than the marginal seller’s cost.d. positive and greater than the marginal seller’scost.arrow_forward
- Give typing answer with explanation and conclusion Explain carefully why, in a competitive market, a quantity less than the equilibrium quantity is inefficient.arrow_forwardThe graph shows the supply curve of fitness trackers and the market price of a fitness tracker. Draw a point that shows the marginal cost of the 30th fitness tracker. What is the marginal cost of the 30th fitness tracker? The marginal cost of the 30th fitness tracker is OA. the producer surplus received by the seller from the 30th fitness tracker O B. the minimum price at which the seller has an incentive to sell the 30th fitness tracker OC. the value that the buyer places on the 30th fitness tracker OD. the price that the seller receives when the 30th fitness tracker is sold 120- 100- 80- 60- 40- 20- Price (dollars per fitness tracker) 0+ 0 20 40 Market price 60 80 100 Quantity (fitness trackers per day) >>> Draw only the objects specified in the question. 120 o o 2arrow_forwardIf 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.arrow_forward
- Price P EQ A B Market for Product X D Quantity What would happen to the equilibrium price of Product X if demand for Product X increased? It would rise. It would fall. It would fluctuate. S It would stay the same. Darrow_forwardSuppose that 20,000 tickets were sold at $120 for an NBA game at Madison Square Garden in New York. The game was sold out and some fans could not get tickets. a. This suggests that selling price was at equilibrium. b. selling price was above equilibrium price. c. he game was advertised too heavily .d. selling price was below equilibrium pricearrow_forwardChewing 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_forward
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