When the Market Price of a Good Is Above Its

question 43

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 be greater than the quantity supplied.
• C) the government will regulate the price of the good to ensure equilibrium is attained.
• D) a surplus will exist in the market.

Grasp the concept and implications of cartels and collusion among firms.

Examine the role and effect of government regulation and antitrust laws on oligopolistic markets and collusive behavior.

Evaluate the economic outcomes of different strategic interactions among oligopolistic firms using payoff matrices.

Understand why and how cartels and oligopolies form and their impact on market structures.

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Definitions:

Equity Method

An accounting technique used to record investments in other companies, wherein the investment is initially recorded at cost and subsequently adjusted to reflect the investor's share of the investee’s net assets and income.

Intra-Entity Inventory Sales

Transactions involving the sale of inventory items between divisions or departments within the same company.

Upstream

In the oil and gas industry, activities related to exploration and production of oil and natural gas.

Downstream

In the oil and gas industry, this refers to processes and operations related to refining crude oil and distributing and marketing petroleum products.