In Markets with Shortages, Businesses Have Incentives to Increase Quantity

question 130

True/False

In markets with shortages, businesses have incentives to increase quantity supplied as long as price exceeds marginal costs.

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Definitions:

Normative

Relating to an ideal standard or model, or being based on what is considered to be the normal or correct way of doing something.

Perceptual

Relating to the ability to interpret or become aware of something through the senses.

Disruptive

Causing or tending to cause disruption; interrupting the normal course or unity of something, often leading to innovation or change.

Social Facilitation

The tendency for people to perform differently when in the presence of others than when alone, typically showing improved performance on simple tasks.