If Producers Incorrectly Set the Price of Their Product Too

question 75

Multiple Choice

If producers incorrectly set the price of their product too low:

• A)a shortage will result and consumers will bid the price down to equilibrium.
• B)a surplus will result and excess goods in inventory will signal the producers to lower their prices.
• C)a shortage will result and consumers will bid the price up to equilibrium.
• D)a surplus will result and excess goods in inventory will signal the producers to restrict output until sales increase.

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