If the Perfectly Competitive Market Demand for Tanning Beds Shifts

question 15

Multiple Choice

If the perfectly competitive market demand for tanning beds shifts from Q_D,91 = 1,230 - 5P to Q_D,92 = 740 - 5P and the market supply is given by Q_S = -100 + 2P,then the change in equilibrium quantity will be:

• A) 140 units.
• B) 280 units.
• C) -98 units.
• D) -140 units.
• E) -150 units.

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Definitions:

Competitive Markets

Markets characterized by a high level of competition where no single buyer or seller can influence prices significantly, leading to efficient distribution of resources.

General Welfare

General welfare refers to the overall health, prosperity, and happiness of a population.

Invisible Hand Principle

Adam Smith's concept that individuals' self-interested actions can lead to positive social and economic outcomes, guided as if by an invisible hand.

Economic Welfare

The overall well-being and standard of living of people in an economy, typically measured by indicators like wealth, health, and happiness, alongside economic factors.