If the price of a good is above the equilibrium price, which of the following will happen?

• A.The quantity demanded is equal to the quantity supplied and the price remains unchanged
• B.There is a shortage (i.e. an excess demand) and the price will fall
• C.There is a surplus (i.e. an excess supply) and the price will rise
• D.There is a surplus (i.e. an excess supply) and the price will fall

Correct Answer: D

In microeconomics, equilibrium price is determined when the quantity demanded is equal to thequantity supplied at equilibrium price in a market, there will be no shortages and no surpluses. If we combine our supply and demand curves on one graph, the point at which they converge determines the equilibrium price. If the price is set above this price and you read across the graph you will see the supply excess demand and there will be a surplus. In order to reduce this surplus, the price will need to fall. The scenario is illustrated in the graph below:
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Which of the following is the most appropriate approach to investors or shareholders who have high level of influence but low interest in the running of business?

• A.Engage and keep them satisfied
• B.Engage and consult with them regularly
• C.Keep these people inform through general communication media
• D.Manage them closely

Correct Answer: A

Explanation
Investors or shareholders who have high level of influence but low interest belong to 'Keep satisfied' quadrant of Mendelow's Stakeholder Matrix.
You may read 2 versions from L4M1 and L4M5 here:

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LO 1, AC 1.1

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Which of the following should be adopted to minimise the conflict between parties in commercial negotiation?

• A.The rule of law
• B.Ground zero
• C.Ground beam
• D.Ground rules

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Which of the following are most likely to be direct costs of a steel manufacturer? Select THREE that apply.

• A.Cleaning services
• B.Coal
• C.Seniormanagement salary
• D.Insurance for production lines
• E.Scrap metal
• F.Hourly production wages

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SBL provides contract bathroom furniture and fittings for a wide variety of domestic and commercial clients.
To some suppliers, SBL spendclaims a large portion of their revenue. But SBL is famous for imposing draconian obligations on these suppliers. Which of the following is most likely to be overarching objective of these suppliers to SBL?

• A.Charge a higher price to compensate for all the pain SBL has put
• B.Win and keep business with SBL at any costs, even without profits
• C.Drop the business with SBL immediately
• D.Hold on and keep SBL happy but make sure that the business is profitable

Correct Answer: A

According to Paul Steele's 'The Seller's Perspective', customer can be classified into 4 categories as below:
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In this scenario, although SBL's spend claims large portion in suppliers' revenues, their draconian treatment will reduce SBL's attractiveness in supplier's perspective.SBL falls into Exploit quadrant. With exploitable customers, suppliers tend to 'milk' the customer and charge a high price to compensate for all the pain customer put on them.

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