Use the Table Below to Answer the Following Questions

question 1

Multiple Choice

Use the table below to answer the following questions.
Table 3.1.1

-Refer to Table 3.1.1.In 2012,the relative price of coffee in terms of cola is

• A)1.25.
• B)1.00.
• C)0.67.
• D)1.56.
• E)unknown without more information.

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Definitions:

Equilibrium Price

The price at which the quantity of a good or service demanded by consumers is equal to the quantity supplied by producers, leading to market equilibrium.

Equilibrium Quantity

The quantity of goods or services supplied and the quantity demanded at which their price is stable, and there is no tendency for it to change unless external factors intervene.

Allocative Efficiency

A state of resource allocation where resources are distributed in accordance with consumer preferences, maximizing overall utility.

Equilibrium Price

The price at which the quantity of a product demanded by consumers equals the quantity supplied by producers, resulting in market balance.