-When a Shortage Exists in a Market

question 190

Multiple Choice

-When a shortage exists in a market

• A) the market clearing price is above equilibrium and market forces will cause the price to fall.
• B) the quantity demanded is less than the quantity supplied at the existing price.
• C) the current price is below the market clearing price and the price will rise.
• D) the quantity supplied is greater than the quantity demanded at the current price.

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Definitions:

Steel

An alloy of iron and carbon, and sometimes other elements, known for its high tensile strength and ability to be shaped into various forms.

Total Cost Curve

A graphical representation that shows how the total cost of production changes as the quantity of output changes.

Output

In economics, this refers to the total amount of goods and services produced by an economic system over a given period.

Total Daily Cost

The complete sum of all expenses incurred by an individual or company in a single day, including both fixed and variable costs.