ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Regardless of the cause, we see in Figure 3.6b that a price above equilibrium will result in quantity supplied being greater than quantity demanded. This excess supply is also known as a surplus. There are too many sellers who are enticed by the high price, and not enough buyers.

Detailed explanation-2: -If the price is above the equilibrium level, then the quantity supplied will exceed the quantity demanded. Excess supply or a surplus will exist. In either case, economic pressures will push the price toward the equilibrium level.

Detailed explanation-3: -Solution. When equilibrium price of a good is more than its market price, then there will be competition among the buyers. This is because when the equilibrium price of a good is above the market price then it implies that there is a situation of excess demand.

Detailed explanation-4: -In the goods market, the statement that no buyer would be willing to pay more than the equilibrium price is false, because the buyer would be willing to pay more to satisfy his want and satisfaction.

Detailed explanation-5: -Answer and Explanation: Yes, greed tends to push the equilibrium price up or down. In most cases, greedy economic entities tend to change their price to benefit from the market. When one entity changes the price, other entities must adjust to sustain the competition.