Suppose That the Garden Gnome Industry Was in Long-Run Equilibrium

question 2

Multiple Choice

Suppose that the garden gnome industry was in long-run equilibrium given the circumstances described .Suppose, that it was discovered to everyone's surprise on January 1, 1993, after it was too late to change orders for gnome molds, that the cost of the plaster and labor needed to make a gnome had changed to $6.If the demand curve does not change, what will happen to the equilibrium price of gnomes?

• A)Stays constant.
• B)Falls by $1.
• C)Rises by $6.
• D)Rises by $1.
• E)Falls by $3.

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A retirement plan where an employer promises a specified pension payment upon retirement, based on the employee's earnings history, tenure of service, and age.