ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -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-2: -A Market Shortage occurs when there is excess demand-that is quantity demanded is greater than quantity supplied. In this situation, consumers won’t be able to buy as much of a good as they would like.

Detailed explanation-3: -The equilibrium occurs where the quantity demanded is equal to the quantity supplied. If the price is below the equilibrium level, then the quantity demanded will exceed the quantity supplied. Excess demand or a shortage will exist.

Detailed explanation-4: -A shortage is a situation in which demand for a product or service exceeds the available supply. When this occurs, the market is said to be in a state of disequilibrium. Usually, this condition is temporary as the product will be replenished and the market regains equilibrium.

Detailed explanation-5: -Lesson Summary Scarcity and shortage are two fundamental concepts. Scarcity refers to the existence of limited resources that are not enough to address unlimited human needs or demands. On the other hand, shortage refers to an occurrence whereby the order in the market outdoes the supply available at a given time.