Final answer:
The statement is false because buyers may be willing to pay higher prices in certain situations, and the equilibrium price is influenced by both buyers and sellers in the market.
Step-by-step explanation:
The statement “In the goods market, no buyer would be willing to pay more than the equilibrium price” is false because:
- Buyers always prefer to pay more for goods: Buyers are willing to pay a higher price if they value the good or service more than the equilibrium price. For example, if a buyer urgently needs a product and there is a shortage in the market, they may be willing to pay a premium price.
- Equilibrium price represents maximum buyer willingness to pay: The equilibrium price is determined by the interaction of supply and demand in the market. It represents the price at which the quantity demanded equals the quantity supplied. Buyers are willing to pay up to the equilibrium price, but not more.
- Buyers are indifferent to prices in the goods market: Buyers are not indifferent to prices in the goods market. They consider their own preferences, budgets, and alternatives before deciding whether to make a purchase. Higher prices, when justified by factors such as quality or scarcity, may impact their willingness to pay.
- Equilibrium price is determined by sellers, not buyers: The equilibrium price is determined through the interaction of buyer and seller negotiations in the market. Both buyers and sellers contribute to the determination of the equilibrium price.