Answer:
C. There are no shortages or surpluses
Step-by-step explanation:
When an economy is in equilibrium it means that supply meets demand at a specific price and the market clears. If there is a surplus/shortage in supply or demand then there is no equilibrium and the market will not clear.
- surplus = excess supply
- shortage = excess demand
In the presence of a surplus or a shortage there is no equilibrium.
A. No: Demand from customers refers to whether they are willing and able to purchase, one cannot measure if they have "enough" of a good through the equilibrium measure.
B: No: If supply is greater than demand there is excess supply and thus a surplus in the market, therefore not in equilibrium.
D: No: Equilibrium is simply the balance between supply and demand. Even if an equilibrium is efficient, it does not necessarily follow that the allocation and use of resources is efficient as well.
