GENERAL KNOWLEDGE

Detailed explanation-1: -To correct this issue, producers will raise the price to reduce demand from consumers and increase their willingness to supply. After there has been a new price introduced, the market will return to a new equilibrium point.

Detailed explanation-2: -A surplus exists when the price is above equilibrium, which encourages sellers to lower their prices to eliminate the surplus. A shortage will exist at any price below equilibrium, which leads to the price of the good increasing.

Detailed explanation-3: -Equilibrium: Where Supply and Demand Intersect The equilibrium price is the only price where the desires of consumers and the desires of producers agree-that is, where the amount of the product that consumers want to buy (quantity demanded) is equal to the amount producers want to sell (quantity supplied).