Refer to Figure 3-8. The graph in this figure illustrates an initial competitive equilibrium in the market for motorcycles at the intersection of D1 and S1 (point A). If there is a surplus of motorcycles how will the equilibrium point change?
A) The equilibrium point will move from A to B.
B) There will be no change in the equilibrium point.
C) The equilibrium point will move from A to C.
D) The equilibrium point will move from A to E.
B
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If the quantity demanded for a product exceeds the quantity supplied, the market price will rise until
A) the quantity demanded equals the quantity supplied. The product will then no longer be scarce. B) quantity demanded equals quantity supplied. The market price will then equal the equilibrium price. C) only wealthy consumers will be able to afford the product. D) quantity demanded equals quantity supplied. The equilibrium price will then be greater than the market price.
Graphically, a firm's profit per unit of output can be found by:
a. the triangle formed under the demand curve. b. the rectangle formed under the demand curve at a given price and quantity combination. c. the rectangle formed under the average-total-cost curve at a given ATC and quantity combination. d. the distance between the demand and average-total-cost curves at any level of output. e. the distance between the horizontal axis and the average-total-cost curves at any level of output.