Created by Boundless
Where is equilibrium located on a supply/demand chart?
A
Where market clearing does not occur.
B
On the demand line.
C
The point where the demand line and the supply line
intersect.
D
On the supply line.
2
Created by Boundless
The market rent of an apartment is $900. Imagine the city government passes a
law that landlords cannot charge more than $800 for an apartment. What will
happen?
A
Prices will decline, demand will rise, supply will fall, and
there will be a shortage
B
Prices will decline, demand will fall, supply will rise, and
there will be a surplus
C
Prices will rise, demand will fall, supply will rise, and there
will be a surplus
D
Prices will rise, demand will rise, supply will fall, and there
will be a shortage
3
Created by Boundless
Given that the demand for capital declines with a rise in the interest rate, while the
supply of capital remains unaffected, what will happen to the new equilibrium
quantity of capital if the interest rate increases?
A
The demand curve would shift rightwards and equilibrium
quantity would decline
B
The demand curve would shift to the right and
equilibrium quantity would increase
C
The demand curve would shift leftwards and equilibrium
quantity would decline
D
The demand curve would shift leftwards and equilibrium
quantity would increase
4
Created by Boundless
If demand increases and supply remains constant, what happens to the market
equilibrium?
A
Quantity rises and price falls
B
Quantity and price both fall
C
Quantity falls and price rises
D
Quantity and price both rise
5
Created by Boundless
If supply falls and demand remains constant, what happens to the market
equilibrium?
A
Quantity and price both rise
B
Quantity rises and price falls
C
Quantity and price both fall
D
Quantity falls and price rises