Suzanne is excited about a black friday sale in which big-screen tvs are advertised for only $400. however, when she gets to the
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Answer:
d. All of the above are correct.
Explanation:
- If the current price exceeds equilibrium price, suppliers are willing to sell more units than in equilibria conditions (Qs in the picture below) , and consumers are willing to buy less units than in equilibria conditions (Qd in the picture below), as shown in the graph that has been attached.
- Then, quantity supplied is greater than quantity demanded (Qs>Qd).
- Equilibrium quantity (Q* in the picture) exceeds quantity demanded at $30 price (Qd in the picture), which is related to the decreased in quantity demanded when prices increases: in equilibrium prices are lower than $30, then consumers are willing to buy more.
- Because quantity supplied is greater than quantity demanded, there is a surplus of blue jeans at $30 price (the different between the amount that consumers are willing to buy and the amount suppliers are willing to sell is positive, and its magnitude equals the surplus of blue jeans).
- See picture attached.
