GK
BUSINESS ECONOMICS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Excess demand
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Relative price
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Inflated price
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Incentives
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Detailed explanation-1: -Producer surplus is the difference between how much a person would be willing to accept for a given quantity of a good versus how much they can receive by selling the good at the market price.
Detailed explanation-2: -Demand is generally considered to slope downward: at higher prices, consumers buy less. The point at which the two curves intersect represents the market-clearing price-the price at which demand and supply are the same. Prices can change for many reasons (technology, consumer preference, weather conditions).
Detailed explanation-3: -How do producers answer the economic question of what to produce in a market economy? They produce products that are the most profitable.
Detailed explanation-4: -The market price is the actual price that prevails in a market at any particular time-the price that you actually pay for a good or service. For example, if you buy a cappuccino today for $3.79, that is the market price to-day.