Question

Suppose that the maximum unit sales in a quarter that we can achieve is 6000 units of each product.

a) True
b) False

Answer 1

This statement is false. In the goods market, sellers may be willing to sell for less than the equilibrium price to generate revenue and cover variable costs.

Step-by-step explanation:

This statement is false because in the goods market, sellers are motivated by profit. If the equilibrium price is higher than what a seller is willing to accept, they will not be able to make a sale. However, if the market price is lower than the equilibrium price, sellers may still be willing to sell at a lower price in order to generate some revenue and cover their variable costs.

For example, if a business has excess inventory and needs to generate cash flow, they may be willing to temporarily sell their goods for less than the equilibrium price to attract customers and generate some revenue.Therefore, it is not accurate to say that no seller would be willing to sell for less than the equilibrium price in the goods market.