When the Market Price of a Good Is Above Its

question 173

Multiple Choice

When the market price of a good is above its equilibrium value,and all other determinants are unchanged:

• A)A shortage will exist in the market.
• B)The quantity demanded will exceed the quantity supplied.
• C)Both the supply curve and the demand curve will shift to the right.
• D)A surplus will exist in the market.

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Definitions:

Finished Product

A completed item that is ready for sale or has been sold.

Raw Material

The basic materials from which products are made, typically unprocessed or minimally processed resources.

Finished Product

Items that have completed the manufacturing process and are ready for sale to customers.

End-Of-Month Inventory

The total value of all inventory held by a company at the end of the month, including raw materials, work in progress, and finished goods.