The Demand for Cars in a Certain Country Is Given

question 29

Multiple Choice

The demand for cars in a certain country is given by: D = 20,000 - P, where P is the price of a car. Supply by domestic car producers is: S = 5,000 + 0.5P. Suppose the economy is closed. The equilibrium price of a car is ________ and equilibrium quantity is ________.

• A)$6,000; 14,000
• B)$8,000; 12,000
• C)$10,000; 10,000
• D)$12,000; 8,000

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Definitions:

Required Share

The portion of equity that must be offered to existing shareholders when new shares are issued.

Ownership

The state or fact of possessing something, often referring to the holding of assets or property.

Staged Investment

The practice of injecting capital into a business in phases based on milestones or performance to reduce the investor's risk.

Risk Management

The practice of identifying, assessing, and controlling threats to an organization's capital and earnings.