Suppose the Equilibrium Price of Oranges Is $2

question 205

Multiple Choice

Suppose the equilibrium price of oranges is $2.00 per pound.If the actual price is above the equilibrium price,a

• A) shortage exists and the price falls to restore equilibrium.
• B) shortage exists and the price rises to restore equilibrium.
• C) surplus exists and the price falls to restore equilibrium.
• D) surplus exists and the price rises to restore equilibrium.
• E) surplus exists but nothing happens until either the demand or the supply changes.

---

Definitions:

Nonliteral

Pertaining to language that does not mean exactly what it says, often used in metaphors, similes, and other figures of speech.

Literal

Taking words in their usual or most basic sense without metaphor or exaggeration.

Metaphor

A figure of speech in which a word or phrase is applied to an object or action to which it is not literally applicable, suggesting a comparison.

Sentence

A group of words that forms a complete thought, generally including a subject and a verb, that expresses a declaration, inquiry, exclamation, or directive.