(a) Select the correct statements. Select one or more: a. In a labor market wher
ID: 1104587 • Letter: #
Question
(a) Select the correct statements.
Select one or more:
a. In a labor market where there is unemployment, the workers are on the short side of the market.
b. My friends and I were willing to buy tickets for a Bruce Springsteen concert that will take place in Northampton next year. But by the time we decided to go, the tickets were sold out. The concert organizers are therefore on the short side of the market.
c. Given the market price, the short side of the market is the side -- either supply or demand -- that is willing to make less transactions at that price.
d. Given the market price, the long side of the market is the side -- either supply or demand -- that is willing to make less transactions at that price.
e. It is the short side of the market that determines the quantity transacted.
f. If you buy a home just to resell it immediately, you are on the short side of the housing market. If, instead, you buy a home and keep it for many decades, then you are on the long side of the housing market.
(b) When the price is higher than the market clearing price, there is an [Choose...(excess supply) or (excess demand)] . As a result, those [Choose...(sellers) or (buyers)] who [Choose...(sell to) or (buy from)] the [Choose...(sellers) or (buyers)] make a rent. When the price is lower than the market clearing price, there is an [Choose...(excess supply) or (excess demand)] . As a result, those [Choose...(buyers)or (sellers)] who [Choose...(sell to) or (buy from)] the [Choose...(buyers) or (sellers)] are making a rent.
Explanation / Answer
a) b. My friends and I were willing to buy tickets for a Bruce Springsteen concert that will take place in Northampton next year. But by the time we decided to go, the tickets were sold out. The concert organizers are therefore on the short side of the market.
c. Given the market price, the short side of the market is the side -- either supply or demand -- that is willing to make less transactions at that price.
e. It is the short side of the market that determines the quantity transacted.
Explanation:The "short side" of the market dominates, with limited quantity demanded or limited quantity supplied.
b) When the price is higher than the market clearing price, there is an (excess supply). As a result, those (sellers) who (sell to) the (buyers) make a rent.
When the price is lower than the market clearing price, there is an (excess demand)] . As a result, those (buyers) who (buy from)] (sellers)] are making a rent.
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