Refer to Figure 3-6. The figure above represents the market for coffee grinders. Compare the conditions in the market when the price is $15 and when the price is $21. Which of the following describes how the market differs at these prices?
A) At each price the demand for coffee grinders exceeds the supply of coffee grinders.
B) At each price there is a shortage; firms will raise the equilibrium price in order to eliminate the shortage.
C) At each price there is a shortage; the shortage is greater at $15 than at $21.
D) The difference between quantity supplied and quantity demanded is greater at $21 than at $15.
C
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All points on the production possibilities frontier
A) are production inefficient. B) achieve allocative efficiency. C) are production efficient but only one point achieves allocative efficiency. D) are allocatively efficient but only one point achieves production efficiency. E) are allocatively inefficient.
A movement along the bond demand or supply curve occurs when ________ changes
A) bond price B) income C) wealth D) expected return