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Suppose That the Equilibrium Price in the Market Is $10

Question 3

Multiple Choice

Suppose that the equilibrium price in the market is $10. If the current market price is $7.50:


A) the equilibrium price will fall to $7.50.
B) competition among buyers will increase the current price.
C) the current price will fall below $7.50 as sellers compete for market share.
D) There is not enough information provided to answer the question.

Correct Answer:

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