When the market price is established where demand and supply curves intersect:
A) consumer buying tends to exceed the quantity producers supply.
B) the quantity consumers demand generally fall short of the quantity producers supply.
C) the quantity demanded and the quantity supplied are equal.
D) all of the above will result.
Answer: C) the quantity demanded and the quantity supplied are equal.
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Suppose an oligopolistic producer assumes its rivals will ignore a price increase but match a price cut. In this case the firm perceives its:
A. demand curve as being of unit elasticity throughout. B. supply curve as kinked, being steeper below the going price than above. C. demand curve as kinked, being steeper below the going price than above. D. demand curve as kinked, being steeper above the going price than below.
Profit-maximizing extraction companies will attempt to:
A. extract resources as quickly as possible. B. delay extraction as long as possible. C. find rates of extraction that maximize the flow of profits over time. D. extract resources at a constant rate every year to minimize price fluctuations.