Answer: Option 'b' is correct.
Step-by-step explanation:
Since we have that
When Demand exceeds supply.
It means money supply is more in the country due to which demand for a good increased more than supply.
It is the situation of inflation.
In this case, price would increase to curb the increase in demand.
For example, if the prevaling price for a particular good is $5, so a person is willing to purchase 10 units as he has $50.
But if the price gets increased and the new price becomes $10, then that person can buy only 5 units from $50.
So, it can reduce the demand and makes it equal to supply.
So, Option 'b' is correct.
