A Market Shortage Is

question 43

Multiple Choice

A market shortage is

• A) The amount by which the quantity demanded exceeds the quantity supplied at a given price.
• B) The result of a price floor.
• C) A situation in which producers cannot sell all the goods and services that they are willing and otherwise able to sell.
• D) The amount by which the cost of production exceeds the price of a good. A market shortage is the excess of quantity demanded over quantity supplied.

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Definitions:

Marginal Cost

The additional cost incurred from producing one more unit of a good or service.

Profit Maximizes

The process or strategy of adjusting production and operations to achieve the highest possible profit.

MC

Stands for Marginal Cost, which is the cost of producing one additional unit of a good or service.

MR

Marginal Revenue, the increase in revenue that results from the sale of one additional unit of output.