Consider the Market for Pulp and Paper

question 10

Multiple Choice

Consider the market for pulp and paper.Suppose,in an attempt to help this industry,the government sets a price floor above the free- market equilibrium price.The result will be

• A)the quantity supplied will exceed quantity demanded and there will be a surplus in the market.
• B)a continuation of the market- determined equilibrium price and quantity.
• C)increased government revenue.
• D)the quantity demanded will exceed quantity supplied and there will be a shortage in the market.
• E)a new free- market equilibrium at a higher price and lower output level.

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Definitions:

Human Capital

Pertains to the abilities, expertise, and experiences held by a person or a group, considered in relation to their worth or expense to a company or nation.

Word Processing

The creation, editing, and production of documents using a software application on a computer.

Tangible Capital

Assets that have a physical form such as machinery, buildings, and land, which are used in the production of goods or services.

Inventory

This term describes the total amount of goods or materials a business has on hand at any given time.