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When the actual market price is below its equilibrium level, suppliers are satisfied but demanders are not. True or False

User Flink
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Final answer:

The statements about buyers not willing to pay more than the equilibrium price and sellers not willing to sell for less than it are both false, as market conditions like scarcity and strategies like penetration pricing can lead to different pricing behaviors.

Step-by-step explanation:

False Statements Regarding Equilibrium Price

The statement that “In the goods market, no buyer would be willing to pay more than the equilibrium price” is false because buyers may be willing to pay more for goods due to factors such as scarcity, perceived value, and preferences.

For example, if the good is rare or has high demand (like concert tickets or limited edition items), buyers might be willing to pay a premium.

Similarly, the statement “In the goods market, no seller would be willing to sell for less than the equilibrium price” is false as sellers might accept a price lower than equilibrium due to reasons like inventory clearance, or market entry strategies, such as penetration pricing.

User Simeon Schaub
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