2.3 Equilibrium

What is the definition of equilibrium price?

• The price at which the quantity demanded equals the quantity supplied

• The price at which the quantity demanded exceeds the quantity supplied

• The price at which the quantity supplied exceeds the quantity demanded

• The price set by the government to control inflation

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DOK Level 1: Recall

Which of the following best describes equilibrium quantity?

• The quantity at which the market is in surplus

• The quantity at which the market is in shortage

• The quantity at which the quantity demanded equals the quantity supplied

• The quantity set by the government to control inflation

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DOK Level 1: Recall

What happens when there is a surplus in the market?

• The quantity demanded exceeds the quantity supplied

• The quantity supplied exceeds the quantity demanded

• The market is in equilibrium

• The government sets a price floor

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DOK Level 1: Recall

What is a shortage in the market?

• When the quantity demanded exceeds the quantity supplied

• When the quantity supplied exceeds the quantity demanded

• When the market is in equilibrium

• When the government sets a price ceiling

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DOK Level 1: Recall

Which of the following is an example of a price ceiling?

• Minimum wage laws

• Rent control laws

• Agricultural price supports

• Luxury tax

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DOK Level 1: Recall

Which of the following is an example of a price floor?

• Rent control laws

• Minimum wage laws

• Price caps on essential goods

• Tax rebates

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DOK Level 1: Recall

Which of the following demonstrates price equilibrium?

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Which of these demonstrates a surplus of goods?

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Which of these demonstrates a shortage of goods?

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Which of the following best describes the difference between a price ceiling and a price floor?

• A price ceiling is a legal maximum on the price at which a good can be sold, while a price floor is a legal minimum.

• A price ceiling is a legal minimum on the price at which a good can be sold, while a price floor is a legal maximum.

• Both price ceiling and price floor are forms of government subsidies.

• Both price ceiling and price floor eliminate shortages and surpluses in the market.