Assume there is a surplus in the market for hybrid automobiles. Which of the following statements correctly describes this situation?
A) Some consumers will be unable to obtain hybrid automobiles at the market price and will have an incentive to offer to buy the product at a higher price.
B) The supply of hybrid automobiles is greater than the demand for hybrid automobiles.
C) the surplus will cause an increase in the equilibrium price of hybrid automobiles.
D) The price of hybrid automobiles will fall in response to the surplus; as the price falls the quantity demanded will increase and the quantity supplied will decrease.
D
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The nominal (money) rate of interest
a. is the real rate of interest plus the inflationary premium. b. can be expected to decline as inflation accelerates. c. fell to historic lows during the 1970s when the United States experienced double-digit rates of inflation. d. can be expected to increase when the government is running a budget surplus.
The government imposes a $2.50 per-unit tax on the production of good X. As a result the
A) supply curve for good X shifts leftward and the price of good X rises. B) quantity supplied of good X falls and the price of good X rises. C) demand curve for good X shifts leftward and the price of good X falls. D) supply curve for good X shifts rightward and the price of good X falls. E) supply curve for good X shifts leftward and the price of good X falls.