When a Market Is in Equilibrium, _____

question 70

Multiple Choice

When a market is in equilibrium, _____

• A) producers earn economic profits.
• B) production exhibits diminishing returns to scale.
• C) market forces exert no pressure for price to change.
• D) industry output is maximized.
• E) market forces allow producers to charge the maximum price.

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Definitions:

Unrealized Loss Account

An account that reflects losses which have occurred on paper due to changes in market values but have not been actually realized through a transaction.

Short-Term Stock Investments

Investments in stock intended to be held for a short duration, typically less than one year, for earning a quick profit.

Fair Value

The estimated market value of an asset or liability, based on current prices in an active market.

Stock Market

A public market for buying and selling equity securities and derivatives of companies, facilitating capital exchange between investors.