If We Observe a Rise in the Equilibrium Price of Product

question 63

Multiple Choice

If we observe a rise in the equilibrium price of product A, we know that either the demand for A has

• A) increased or the supply of A decreased or both.
• B) increased or the supply of A increased or both.
• C) decreased or the supply of A increased or both.
• D) decreased or the supply of A decreased or both.
• E) none of the above.

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Definitions:

Discrete Random Variable

A variable that can take on a countable number of distinct and separate values, often used in probability and statistics.

Probability Distribution

A statistical function that describes all the possible values and likelihoods that a random variable can take within a given range.

Expected Value

The long-run average value of repetitions of the experiment it represents, computed as the weighted average of all possible values.

Poisson Random Variable

Represents the number of events occurring in a fixed interval of time or space, assuming that these events happen with a known constant mean rate and independently of the time since the last event.