CBSE Class 12-commerce Answered
Explain a situation where excess demand exists in a
market.
Asked by Topperlearning User | 26 Apr, 2016, 07:36: AM
Expert Answer
Assume that the equilibrium price is Rs 300 to supply 3 dozen of mangoes which is equal to market demand 3 dozen of mangoes. If the price decreases to Rs 100, then the market supply will be 2 dozen of mangoes and the market demand 4 dozen of mangoes. This is a situation where the market demand is in excess or shortage of supply in the market.
Therefore, at a given price, if the market demand exceeds the market supply, then it is said to that excess demand exists in the market at that price.
Answered by | 26 Apr, 2016, 09:36: AM
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Asked by Topperlearning User | 26 Apr, 2016, 07:36: AM
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Asked by Topperlearning User | 26 Apr, 2016, 07:36: AM
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