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When the price floor is higher than the equilibrium price there is a a surplus b a shortage c both a shortage and a surplus dneither a shortage nor a surplus?
When the price floor is set above the equilibrium price, it leads to a surplus. This occurs because the higher price incentivizes producers to supply more goods than consumers are willing to buy at that price, resulting in excess supply in the market.
Market clearing price?
The price that exists when a market is clear of shortage and surplus, or is in equilibrium.
How does a surplus or a shortage of a good or service affect the market price?
A surplus or a shortage of a good or service affects the market price directly. When there is a surplus, the prices goes down and when there is a shortage the price increases due to the demand levels.
How does the consumer surplus change as the equilibrium price of a good rises or falls?
As the equilibrium price of a good raises the producer surplus increases as well, and as the equilibrium price falls the producer surplus decreases accordingly.
What is the point at which there is neither a surplus or shortage?
The point at which there is neither a surplus nor a shortage is known as the equilibrium point. At this point, the quantity of a good or service demanded by consumers equals the quantity supplied by producers. This balance ensures that the market clears, meaning that all goods produced are sold and there are no unmet demands. The equilibrium price is the market price at which this balance occurs.
Market clearing price?
The price that exists when a market is clear of shortage and surplus, or is in equilibrium.
When the price floor is higher than the equilibrium price there is a a surplus b a shortage c both a shortage and a surplus dneither a shortage nor a surplus?
When the price floor is set above the equilibrium price, it leads to a surplus. This occurs because the higher price incentivizes producers to supply more goods than consumers are willing to buy at that price, resulting in excess supply in the market.
How does a surplus or a shortage of a good or service affect the market price?
A surplus or a shortage of a good or service affects the market price directly. When there is a surplus, the prices goes down and when there is a shortage the price increases due to the demand levels.
How does the consumer surplus change as the equilibrium price of a good rises or falls?
As the equilibrium price of a good raises the producer surplus increases as well, and as the equilibrium price falls the producer surplus decreases accordingly.
How does producer surplus change as the equilibrium price of a good rises or falls?
Producer surplus increases as the equilibrium price of a good rises, and decreases as the equilibrium price falls.
What is the impact of a shortage on the equilibrium price and quantity in an economic market?
A shortage in an economic market leads to an increase in the equilibrium price and a decrease in the equilibrium quantity.
Suppose the price of corn is 3.25 per bushel. is there a shortage or surplus of corn at that price?
there is a surplus
What causes a shortage of goods price ceiling or price floor Which causes a surplus?
if, at a current price there is a shortage of a good
What happens to consumer surplus if the price is above equilibrium?
When the price is above equilibrium, there is a surplus because supply is greater than demand. The price of the good will naturally decrease back to its equilibrium price where demand and suppy interesect, thus eliminating the surplus.
How can one calculate surplus on a graph?
To calculate surplus on a graph, find the equilibrium point where supply and demand intersect. The surplus is the area above the equilibrium price and below the demand curve. Subtract the equilibrium price from the highest price on the demand curve to find the surplus.
Which is shown by the intersection of the supply curve and the demand curve?
The equilibrium price and quantity - those which clear the market, leaving neither a surplus nor a shortage of the good.
When a surplus of a product will arise when price is above equilibrium or below equilibrium?
above equilibrium
