Which of the following statements is false?
A) At equilibrium in a market, scarcity does not exist.
B) If there is a shortage of 100 units at a price of $2 per unit, the shortage will be greater than 100 units at a price of $1 per unit.
C) If there is a surplus of 30 units at a price of $3, the surplus will be less than 30 units (or even nonexistent) at a price of $2.
D) If there is a surplus, suppliers will not be able to sell all they had hoped to sell at a particular price.
A
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Both buyers and sellers are price takers in a perfectly competitive market because
A) each buyer and seller is too small relative to others to independently affect the market price. B) both buyers and sellers in a perfectly competitive market are concerned for the welfare of others. C) the price is determined by government intervention and dictated to buyers and sellers. D) each buyer and seller knows it is illegal to conspire to affect price.
If a decrease in the price of good Y causes the demand for good Z to decrease, this indicates that
a. Y and Z are complements. b. Y and Z are substitutes. c. Y and Z are unrelated. d. the demand for Y is elastic, but the demand for Z is inelastic.