Shortages Are Associated with Price _______;Surpluses Are Associated with Price

question 139

Multiple Choice

Shortages are associated with price _______;surpluses are associated with price _______.

• A)floors;ceilings
• B)ceilings;floors
• C)equilibrium;equilibrium
• D)None of these choices are correct.

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Definitions:

Economic Profit

The difference between total revenue and the total cost of inputs (including opportunity costs), reflecting the additional gain from business operations beyond breaking even.

Economic Loss

The decrease in financial value or resources due to an event, action, or inaction, encompassing factors such as direct, indirect, and opportunity costs.

Production Costs

Expenses directly related to the creation and manufacturing of a product, including raw materials, labor, and overhead.

Explicit Costs

These are direct, out-of-pocket payments for expenses incurred by a business, such as wages, rent, and materials.