ECONOMICS
TECHNOLOGY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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FALSE
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TRUE
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Either A or B
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None of the above
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Detailed explanation-1: -A shortage, in economic terms, is a condition where the quantity demanded is greater than the quantity supplied at the market price.
Detailed explanation-2: -Excess Demand: the quantity demanded is greater than the quantity supplied at the given price. This is also called a shortage. Excess Supply: the quantity demanded is less than the quantity supplied at the given price. This is also called a surplus.
Detailed explanation-3: -A change in the quantity demanded refers to movement along the existing demand curve, D0. This is a change in price, which is caused by a shift in the supply curve. Similarly, a change in supply refers to a shift in the entire supply curve, which is caused by shifters such as taxes, production costs, and technology.
Detailed explanation-4: -A surplus exists if the quantity of a good or service supplied exceeds the quantity demanded at the current price; it causes downward pressure on price.
Detailed explanation-5: -The quantity supplied of a good or service exceeding the quantity demanded is called a surplus. If the quantity demanded exceeds the quantity supplied, a shortage exists. The equilibrium price is the price in which the quantity supplied equals the quantity demanded.