Question

At a price of $13, quantity demanded is ________, quantity supplied is ________ ; therefore excess ________ has occurred.

Answer 1

At a price of $13, quantity demanded is 120 units, quantity supplied is 130 units; therefore, excess supply has occurred. This is also called as economic surplus. This is the effect when the price set to the product is above its equilibrium level which is determined by its supply and demand.