Perfectly competitive markets are efficient because
A) they always reach equilibrium.
B) firms in the market are price takers.
C) the cost to society for producing the goods is exactly equal to the value that society places on the good.
D) the long run equilibrium assures that the prices of resources will not increase.
C
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The structural surplus
A) is legally required to be positive. B) fluctuates over the business cycle. C) is, by definition, equal to the negative of the cyclical deficit. D) equals the actual surplus plus the cyclical surplus. E) is the government budget surplus that would exist if the economy was at full employment.
If a price ceiling is set below the equilibrium price in a market:
A. Rationing will be unnecessary B. Surpluses of the commodity will develop C. The quantity demanded will exceed the quantity supplied D. The quantity supplied will exceed the quantity demanded