Question

When quantity demanded exceeds quantity supplied at the current market price, the market has a shortage, and market price will likely rise in the future to eliminate the shortage.

a. true
b. false?

Answer 1

True.

However, the question should be clear it is a free market where market forces rule, therefore a shortage will cause some consumers to be willing to pay higher prices and producers will see benefit and revenue, thus producing more and resolving the shortage.