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A decrease in supply will cause an?
increase in equilibrium price and a decrease in equilibrium quantity, which leads to a shortage at the original price.
What describes the situation that occurs when the equilibrium quantity has been reached?
There is no surplus or shortage
What happens to the equilibrium when supply rises and demand stays the same?
Shortage will occur.
Market clearing price?
The price that exists when a market is clear of shortage and surplus, or is in equilibrium.
Binding price floor in a market sets price?
below equilibrium price and causes a shortage
What happens if a product is added to a system at equilibrium?
The echilibrium will be restored.
A decrease in supply will cause an?
increase in equilibrium price and a decrease in equilibrium quantity, which leads to a shortage at the original price.
A shortage develop when?
The equilibrium quantity supplied is lower than the actual quantity supplied. The market price is below the equilibrium price.
What describes the situation that occurs when the equilibrium quantity has been reached?
There is no surplus or shortage
What happens to the equilibrium when supply rises and demand stays the same?
Shortage will occur.
Describes the situation that occurs when the equilibrium quantity has been reached?
There is no surplus or shortage
Market clearing price?
The price that exists when a market is clear of shortage and surplus, or is in equilibrium.
Binding price floor in a market sets price?
below equilibrium price and causes a shortage
True or false A price fixed below the equilibrium price of a product will cause a shortage of that product?
true
What price must a price ceiling be less than for it to result in a shortage?
It must be less than the equilibrium price.
What happens to the equilibrium price when supply goes down?
When supply goes down the equilibrium price tend also to fallcausing the price of commodities to fall and hence shortage of goods and services to the economy.
How price adjustments eliminate a shortage?
The price will increase , Demand will decrease and Supply will increase until reach the equilibrium point
