Question 27
Price DeterminationThe hoarding of goods is usually experienced when
- A.supply is greater than demand
- B.the market price is above the equilibrium price
- C.demand is greater than supply
- D.excess demand is greater than excess supply
Show the answer and explanation
Answer: C (demand is greater than supply)
Explanation
When goods are scarce (demand exceeds supply), traders hold them back expecting higher prices: hoarding.