Question

A surplus of a product will arise when price is above equilibrium with the result that quantity demanded exceeds quantity supplied. above equilibrium with the result that quantity supplied exceeds quantity demanded. below equilibrium with the result that quantity demanded exceeds quantity supplied. below equilibrium with the result that quantity supplied exceeds quantity demanded.

Answer 1

A surplus of a product will arise when price is, above equilibrium, with the result that quantity supplied exceeds quantity demanded.

What will a surplus of a product lead to?

The amount of utility or value that consumers and producers receive as a result of transactions is referred to as surplus in economic theory. Karl Marx explicitly theorized the economic idea of surplus product in his critique of political economy.

When the amount supplied exceeds the amount required, there is an excess supply, which is known as a market surplus. Consequently, some producers won't be able to sell all of their products. To make their goods more appealing, they will be compelled by this to reduce its price. Every producer and consumer in an economy seeks to increase excess in order to increase utility.

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