If a Market Has a Surplus, How Will the Market

question 255

Multiple Choice

If a market has a surplus, how will the market respond?

• A) The price will fall and the quantity supplied will fall.
• B) The price will fall and the quantity supplied will rise.
• C) The price will rise and the quantity supplied will fall.
• D) The price will rise and the quantity supplied will rise.

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Definitions:

Power Cords

Electrical cables that connect an appliance to the main electricity supply, enabling its operation.

Market Wage Rate

The prevailing rate of pay for given work in a specific industry or region, determined by supply and demand for labor.

Profit-Maximizing Quantity

The level of output at which a company can make the highest possible profit, considering its cost structures and market price.

Technological Advance

The process of introducing new technology or improving existing technology which significantly increases efficiency, productivity, or outcomes in various fields.