Refer to the Figure Below: Let Supply Remain Constant

question 32

Multiple Choice

Refer to the figure below: Let supply remain constant at S; an increase in the price of a substitute good causes consumers to be willing and able to buy 150 more units of the good at each price in the list than they were when demand was D.Which of the following statements is (are) true?

• A)At the original equilibrium price there will be a shortage of 150.
• B)At the original equilibrium price there will be a surplus of 150
• C)At the new equilibrium P = $6 and Q = 450.
• D)At the new equilibrium P = $7 and Q = 400.
• E)both a and d

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Definitions:

Government Agencies

Public sector entities that are established to perform specific functions or services on behalf of a government.

Condensed Income Statements

Condensed Income Statements summarize the revenue, expenses, and net income of a company, providing a simplified overview of its financial performance over a specified period.

Merchandising Companies

Businesses that purchase goods in finished form and resell them to consumers without further processing.

Purchases Discount

A reduction in price given by a seller to a buyer for paying an invoice within a specified time frame.