Suppose That a Market for a Product Is in Equilibrium

question 15

Multiple Choice

Suppose that a market for a product is in equilibrium at a price of $3 per unit. At any price below $3 per unit

• A) there will be an excess demand for the product.
• B) there will be an excess supply of the product.
• C) the quantity demanded of the product will be less than the quantity supplied of that product.
• D) there will be a surplus of that product.

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Definitions:

Mass Production

The manufacturing of large quantities of standardized products, often using assembly lines or automated technology, which benefits from economies of scale.

Suburbanization

The process by which populations move from urban areas to suburbs, often leading to the growth of residential areas on the outskirts of cities.

Farms

Land and the buildings on it, used for growing crops and/or raising animals as a primary source of income.

Protective Tariffs

Taxes imposed on imported goods to protect domestic industries from foreign competition by making imports more expensive.