Can anyone please help me with the following two questions?
- A quota on an imported good below the market-clearing quantity will most likely lead to which of the following effects?
A The supply curve shifts upward.
B The demand curve shifts upward.
C Some of the buyer’s surplus transfers to the seller.
The correct answer is C but according to the graph I draw all three answers are correct?
- 12 Which of the following statements best characterizes the market mechanism for attaining equilibrium?
A Excess supply causes prices to fall.
B Excess demand causes prices to fall.
C The demand and supply curves shift to reach equilibrium
The correct answer is A but i think C is also correct?
Can anyone help here? Many thanks!!