Learning Path
Question & Answer
Choose the Best Answer
A surplus occurs as supply exceeds demand
Demand increases until it meets supply
Consumers will purchase more of the product
The market reaches a new equilibrium immediately
Understanding the Answer
Let's break down why this is correct
When the price is higher than the equilibrium, sellers want to sell more because the price is attractive. Other options are incorrect because Some think a higher price makes people want more; It sounds like a higher price means more sales, but the opposite happens.
Key Concepts
Market Equilibrium Analysis
medium level question
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Deep Dive: Market Equilibrium Analysis
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Definition
Market equilibrium analysis focuses on the point where the quantity demanded by consumers matches the quantity supplied by suppliers at a specific price level. This equilibrium point determines the market price and quantity, which can change over time due to shifts in demand and supply patterns.
Topic Definition
Market equilibrium analysis focuses on the point where the quantity demanded by consumers matches the quantity supplied by suppliers at a specific price level. This equilibrium point determines the market price and quantity, which can change over time due to shifts in demand and supply patterns.
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