Question 12
Price DeterminationA market is in disequilibrium if
- A.the quantity purchased is greater than the quantity sold
- B.the quantity sold differs from the quantity purchased
- C.at a lower price, a large quantity is sold
- D.the quantity demanded differs from the quantity supplied
Show the answer and explanation
Answer: D (the quantity demanded differs from the quantity supplied)
Explanation
Equilibrium means quantity demanded equals quantity supplied; when they differ there is a shortage or surplus.