Define excess supply.
Understand the Problem
The question is asking for a definition of the economic concept 'excess supply', which refers to a situation where the quantity of a good or service supplied exceeds the quantity demanded at a given price level.
Answer
A surplus that occurs when the quantity supplied exceeds the quantity demanded at a given price level.
The final answer is a surplus that occurs when the quantity supplied of a product or service exceeds the quantity demanded at a given price level.
Answer for screen readers
The final answer is a surplus that occurs when the quantity supplied of a product or service exceeds the quantity demanded at a given price level.
More Information
Excess supply generally leads to a decrease in prices until market equilibrium is reached, where supply equals demand.
Tips
A common mistake is to confuse excess supply with excess demand. Remember, excess supply, or a surplus, happens when the market price is set too high, leading to more supplied than demanded.
Sources
- What is meant by excess supply - Tutor2u - tutor2u.net
- Excess supply - Wikipedia - en.wikipedia.org
- EXCESS SUPPLY definition | Cambridge English Dictionary - dictionary.cambridge.org
