At an Equilibrium Price for Gasoline

question 193

Multiple Choice

At an equilibrium price for gasoline,

• A)everyone with the desire and the income to buy gasoline at that price can do so.
• B)surpluses are inevitable.
• C)inherent market forces will eventually change the quantities demanded and supplied.
• D)suppliers must be using the most efficient oil-drilling equipment available.

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Definitions:

Perfect Information

A situation in decision theory and economics where all participants have complete and accurate information about all aspects relevant to their decision-making.

Net Present Value

Net Present Value is a financial metric that calculates the difference between the present value of cash inflows and the present value of cash outflows over a period of time.

Expected Value

The long-term average or mean of a random variable or a probability distribution.

Perfect Information

A scenario in which all relevant economic information is known to all participants at the same time.