Use the Figure Below to Answer the Following Questions

question 102

Multiple Choice

Use the figure below to answer the following questions. Figure 3.4.1
-At price P₁ in Figure 3.4.1

• A)there is a surplus in the amount of Q₄ - Q₂.
• B)there is a shortage in the amount of Q₄ - Q₂.
• C)there is a tendency for the price to fall.
• D)the equilibrium quantity is Q₂.
• E)the equilibrium quantity is Q₄.

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Definitions:

Probability Function

A mathematical function that delivers the likelihoods of various potential outcomes for an experiment.

Expected Value

The long-term average or mean of random variables, taking into account all possible outcomes weighted by their probabilities.

Binomial Experiment

A statistical experiment that has exactly two possible outcomes for each trial and a fixed number of trials, where the probability of success is constant.

Variance

A measure of the spread or dispersion of a set of data points around the mean, indicating how much the data values differ from the average value.