QUESTION 5 Exhibit 51 Frooway Spoce Refer to Exhibit 51 whic

QUESTION 5 Exhibit 5-1 Frooway Spoce Refer to Exhibit 5-1, which shows supply and demand for freeway space at both 8 a.m. and 11 p.m. At a zero money price, t here is a of freeway space at 8 a.m. and at 11 p.m a. shorta b.surplus a shortage c.surplus; equilibrium d. shortage; a surplus QUESTION6 Price serves as a a. rationing device. O b. transmitter of information. c. means of determining who gets what of the available limited resources and goods od.a and b e.all of the above

Solution

Ans 5) A is the correct option. A shortage ; equilibrium. At zero money price at 8am the quantity demanded exceeds the quantity supplied so there is a shortage whereas at 11pm the supply curve and demand curve intersect meaning demand is equal to supply so equilibrium.

Ans6) E is the correct option option. All of the above. Price served as a rationing device, transmitter of information, means of determining who gets what of the available limited resources and goods.