If the Actual Market Price Were Fixed at $6 Per

question 130

Multiple Choice

If the actual market price were fixed at $6 per unit in Figure 3.2, Figure 3.2 Supply and Demand

• A)There would be a surplus of 40 units.
• B)There would be a surplus of 20 units.
• C)There would be a shortage of 40 units.
• D)There would be a shortage of 20 units.

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Definitions:

Barriers to Entry

Factors that prevent or hinder companies from entering a particular market, which can include high startup costs, strict regulations, and established competition.

Pure Monopoly

A market structure characterized by a single seller or producer dominating the entire market, facing no close substitutes for its product or service.

High Barriers to Entry

Obstacles that make it difficult for new competitors to enter an industry, such as high startup costs or strict regulations.

Marginal Revenue

The extra revenue earned by selling an additional unit of a product or service.