Asked by Keeva Szeto on Apr 26, 2024
Verified
Excess supply occurs when the:
A) price is above the equilibrium price.
B) quantity demanded exceeds the quantity supplied.
C) price is below the equilibrium price.
D) quantity demanded exceeds the quantity supplied and the price is below the equilibrium price.
Excess Supply
A market condition where the quantity of a good supplied is greater than the quantity demanded at the current price.
Equilibrium Price
The price at which the quantity of a good or service demanded meets the quantity supplied, resulting in market balance.
Quantity Demanded
The total amount of a good or service that consumers are willing to purchase at a given price level.
- Pinpoint the circumstances leading to market imbalances in terms of surplus or shortage.
Verified Answer
RM
Rylea MarcumMay 01, 2024
Final Answer :
A
Explanation :
Excess supply, also known as a surplus, occurs when the price of a good is above its equilibrium price, leading to a situation where the quantity supplied exceeds the quantity demanded.
Learning Objectives
- Pinpoint the circumstances leading to market imbalances in terms of surplus or shortage.