GK
BUSINESS ECONOMICS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Which of the following happens when the Qs is greater than the Qd?
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Equilibrium
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Surplus
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Shortage
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Consumer surplus
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Explanation:
Detailed explanation-1: -If there is a scarcity of a good, quantity demanded exceeds the quantity supplied. If there is a surplus, quantity supplied exceeds the quantity demanded.
Detailed explanation-2: -How does the market move toward equilibrium? If the market price is above equilibrium, quantity supplied will be greater than quantity demanded; creating a surplus. When that occurs, market forces push the price downward toward equilibrium (increasing Qd and decreasing Qs) until the surplus is eliminated.
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