Scalping activity arises when
A) the prices of goods are allowed to adjust to their equilibrium levels.
B) the quantities of goods demanded and supplied are allowed to adjust to their equilibrium levels.
C) the prices of goods are restricted to levels above equilibrium prices.
D) the prices of goods are restricted to levels below equilibrium prices.

Question

Quizplus · Accepted Answer

Scalping activity refers to the practice of buying and immediately reselling goods at a higher price. This is only possible when prices are temporarily below equilibrium levels. Therefore, the prices of goods must be restricted to levels below equilibrium prices to facilitate scalping activity.

Scalping Activity Arises When