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Other Things Being Equal, the Effects of an Increase in the Price

question 21

Multiple Choice

Other things being equal, the effects of an increase in the price of computers would best be represented by which of the following?


Definitions:

Surplus

A situation where the quantity of a good or service supplied exceeds the quantity demanded, often resulting in excess stock and potential price reductions.

Price Ceiling

A government-imposed limit on how high a price can be charged for a product or service, intending to protect consumers from excessive prices.

Price Floor

A price floor is a government- or authority-imposed minimum price set above the equilibrium price, preventing the market price from falling below it.

Shortage

A situation where demand for a product or service exceeds its supply in a market.

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