The correct answer is: "if prices rise over the equilibrium price there will be an excess of supply"
The equilibrum price represents the point at which the desires of producers and consumer meet in a market. Therefore, the product is commercialized at the market price where the quantity supplied equals the quantity demanded.
The law of demand states that there is an inverse relationship between price and quantity demanded (ceteris paribus, hence given that the rest remains equal), while the law of supply states that there is a direct relationship between price and quantity supplied (ceteris paribus.
Therefore, a high price is located above the equilibrium price. <u>The amount demanded will decrease, while the amount supplied will increase, generating an excess of supply</u>
