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The Current Price of Cupcakes Is $4, but the Equilibrium

Question 17

Multiple Choice

The current price of cupcakes is $4, but the equilibrium price in the market for cupcakes is $5. What will happen in this market?


A) There will be a shortage, but the price will gravitate up.
B) There will be a surplus, but the price will gravitate down.
C) There will be a shortage, but the price will gravitate down.
D) There will be a surplus, but the price will gravitate up.

Correct Answer:

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