Question

If the average market price for an item is higher than the equilibrium price,

which of the following is likely to take place?
A. The price will increase drastically.
B. Supply and demand will be equal.
C. Consumers will buy all of the product supply and not be satisfied.
D. More product will be produced than consumers want to purchase.

Answer 1

d.

Step-by-step explanation:

Answer 2

D. More product will be produced than consumers want to purchase.

Step-by-step explanation:

The supply curve for any good slopes upward: the higher the price, the more quantity is produced.

The demand curve for any good slopes downward: the higher the price, the less quantity is produced.

For this reason, if the average market price is higher than the equilibrium price (the equilibrium price is the price where supply and demand are equal), then, supply will be higher than demand, because producers will be enticed by the higher price.

However, this supply will not meed demand, creating excess output, or excess supply.