Question

Please select the best answer from the choices provided A situation in which quantity demanded is greater than quantity supplied best describes a. excess supply. b. shortage. c. equilibrium of demand. d. surplus.

Answer 1

A situation in which quantity demanded is greater than quantity supplied best describes shortage. Shortage is when any product or service lacks the means to provide or satisfy its demand. A shortage in the product or service usually results to a price increase. On the other hand, a surplus results to a price decrease.

Answer 2

Answer: b). Shortage

Explanation:

Shortage as the name suggests is the relative scarcity of goods in comparison to its demand. Shortage occurs when quantity demanded of a good is greater than its supply. In situations of shortage, the price of the good will rise and the quantity demanded will fall till it is equal to the supply.

So, the correct option is b). shortage