SEARCH
You are in browse mode. You must login to use MEMORY

   Log in to start


From course:

Economics A Level (DONEEEEEEE)

» Start this Course
(Practice similar questions for free)
Question:

How, using Market Forces, can Excess Demand be extinguished?

Author: eric_galvao



Answer:

-This is when Demand for the Good is Greater than the Supply. This happens when the Price is Below the Equilibrium Price. -If so, then the Price would be Forced Upwards as to Match the Demand, Supply must Increase. Only way to Reasonably Achieve that is Increasing the Price [Incentive] leading to an Equilibrium Point being Reached.


0 / 5  (0 ratings)

1 answer(s) in total