In the market for a good, a shortage will exist if the price is:above the equilibrium price,
1- In the market for a good, a shortage will exist if the price is:above the equilibrium price, resulting in the quantity supplied exceeding the quantity demandedabove the equilibrium price, resulting in the quantity demanded exceeding the quantity suppliedbelow the equilibrium price, resulting in the quantity supplied exceeding the quantity demandedbelow the equilibrium price, resulting in the quantity demanded exceeding the quantity supplied2- Suppose the market for a good is perfectly competitive and that it is initially in equilibrium. If the supply of the good increases and the demand for the good simultaneously decreases, then equilibrium:price will fall, but the equilibrium quantity may either rise, fall, or remain unchangedprice will rise, but the equilibrium quantity may either rise, fall, or remain unchangedquantity will fall, but the equilibrium price may either rise, fall, or remain unchangedquantity will rise, but the equilibrium price may either rise, fall, or remain unchangedprice will rise and the equilibrium quantity will fallquantity will rise and the equilibrium price will fall3- Suppose the market supply of a good is given by P = 10 + 0.2Q, the market demand is given by P = 60 – 0.5Q, and the market is in equilibrium. If the government imposes a price restriction of P = $20 per unit, then subsequent to this market intervention there will be a:shortage of 30 unitsshortage of 50 unitsshortage of 80 unitssurplus of 30 unitssurplus of 50 unitssurplus of 80 units4- In chapter 4, the economic concepts of producer surplus and consumer surplus are defined and discussed. The consumer surplus derived by an individual from a good or service:i. is the difference between the minimum amount the consumer is willing to pay on each unit and the price he/she actually paysii. is the difference between the maximum amount the consumer is willing to pay on each unit and the minimum prices that producers are willing to acceptiii. is the difference between the maximum amount the consumer is willing to pay on each unit and the price he/she actually paysiv. will decrease if price decreasesiiiiiii and ivii and iviii and iv5- Suppose the market demand for a good is described by the equation P = 120 – 2Q. If a change in market supply results in price decreasing from P0= $60 to P1= $50, then the resulting change in consumer surplus is:Q = 0 units of the good, because in equilibrium there is not a surplus (nor a shortage) of units$325$650$900$1225
