If a Market Is NOT in Equilibrium, Then Which of the Following

question 32

Multiple Choice

If a market is NOT in equilibrium, then which of the following is likely to occur?

• A) The demand curve will shift to bring the market to equilibrium.
• B) The supply curve will shift to bring the market to equilibrium.
• C) The price will adjust to bring the market to equilibrium.
• D) Both A and B are correct.

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Definitions:

Dividends

Corporate profits shared with shareholders in the form of monetary disbursements.

Significant Influence

The power to participate in the financial and operating policy decisions of a business, but not control them completely, typically associated with ownership of between 20% and 50% of voting stock.

Fair-value Method

An accounting strategy used for valuing and assessing assets and liabilities based on current market prices or estimates.

Equity Method

An accounting technique used to assess the earnings of an investment in another company by recognizing the income earned proportional to ownership interest.