10
lesson pretestMultiple Choice

Pretest

Question 10 • Economics

If the quantity supplied is greater than the quantity demanded, what must happen to the price in order to reach equilibrium?

Answer
A
Supply and demand must be lowered.
B
The price of the product will decrease to meet equilibrium.
C
Supply and demand must be raised.
D
The price of the product will increase to meet equilibrium.

Explanation

When quantity supplied is greater than quantity demanded, a surplus exists: sellers have more of the product than buyers want at the current price. Sellers lower the price to attract more buyers, moving the market toward equilibrium, so the price will decrease.

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