Question

question 5 of 5 martin has a clothing store and he has managed to get the only pair of sneakers that everyone wants to buy. how is he most likely going to price these shoes? select a response. he will keep the price the same as his other shoes to be fair he will lower the price since demand is very low and there is a surplus he will raise the price since demand is high and supply is scarce he will raise the price since demand is very low and supply is scarce

Explanation:

To determine how Martin will price the sneakers, we analyze the supply - demand relationship. The sneakers are the only pair (so supply is scarce), and everyone wants to buy them (so demand is high). In economic theory, when demand is high and supply is low (scarce), sellers typically raise prices to maximize profit or balance the market.

• The first option is incorrect because keeping the price the same ignores the high demand and scarce supply.
• The second option is wrong as the problem states everyone wants to buy the sneakers, so demand is high, not low, and there is no surplus (only one pair, so supply is limited).
• The fourth option is incorrect because the problem indicates high demand (everyone wants to buy), not low demand.

Answer:

C. He will raise the price since demand is high and supply is scarce