Question

Suppose that the equilibrium tuition at College X is $2,000 a semester and the tuition that students are charged is $1,000 a semester. At $1,000 tuition a semester,

Answer 1

Answer:

a. quantity demanded of openings at the college is greater than quantity supplied.

Explanation:

Here is the full question :

Suppose that the equilibrium tuition at College X is $2,000 a semester and the tuition that students are charged is $1,000 a semester. At $1,000 tuition a semester,

a.quantity demanded of openings at the college is greater than quantity supplied.

b.quantity supplied of openings at the college is greater than quantity demanded.

c.quantity supplied of openings at the college equals quantity demanded.

d.quantity supplied of openings equals demand.

e.none of the above

Equilibrium price is the price at which quantity demanded equals quantity supplied.

When price is below equilibrium price, quantity demanded would exceed quantity supplied. As a result there would be scarcity. Prices would rise until equilibrium is reached

When price is above equilibrium price, quantity supplied would exceed quantity demanded, As a result, there would be surplus. Prices would fall until equilibrium is reached

Equilibrium tuition is $2,000 but the tuition charged is $1000. Thus, there would be excess demand over supply