Allow the market to work by lowering the price until equilibrium is restored.
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15
Give one method to eliminate a surplus involving demand.
Get the demand curve to shift right through advertising or eliminating substitutes.
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15
What occurs when the price of a product is higher than the equilibrium price?
A surplus occurs—quantity supplied exceeds quantity demanded.
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shark
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shark
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baam
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15
How can a Christian show Christ to others during a surplus or shortage?
By demonstrating patience, fairness, and compassion, helping others in need, and encouraging ethical behavior in market dealings.
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15
What happens when the price is set above the equilibrium price?
A surplus occurs, with excess unsold products.
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15
What does the principle of diminishing marginal utility state?
People receive less additional satisfaction from each extra unit of a good or service consumed over a period of time.
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thief
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15
State the law of demand.
Other things being held constant, the lower the price of a good or service, the greater the quantity demanded; the higher the price, the lower the quantity dema
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15
How do production costs affect supply?
If production costs rise, the firm decreases the quantity supplied at the same price.
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15
What is a price ceiling?
A government-mandated maximum price that can cause shortages if set below equilibrium.
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shark
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baam
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15
What happens when the price is set below the equilibrium price?
A shortage occurs, with demand exceeding supply.
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15
What happens to quantity supplied when the price changes?
A change in price results in a change in the quantity supplied.
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15
At what point do supply and demand intersect?
At the market equilibrium point, where quantity demanded equals quantity supplied.
