At prices above the equilibrium price, what occurs?

What will be an ideal response?


If the price exceeds the equilibrium price, there is a surplus because the quantity supplied exceeds the quantity demanded. With a surplus, the law of markets points out that the price will fall. As the price falls, the quantity supplied decreases and the quantity demanded increases, thus decreasing the size of the surplus. The price will continue to fall as long as there is a surplus, that is, as long as the price exceeds the equilibrium price. Ultimately the price will fall to equal the equilibrium price, at which time the surplus will be eliminated and the price will no longer change.

Economics

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Answer the following statement true (T) or false (F)

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With respect to events like global warming, some economists suggest using falling discount rates because

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Economics

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Economics