If the equilibrium price for a half gallon of organic milk is $4 and the current price for a half gallon of milk is $3.25, market forces will cause all of the following to occur except which one?

Question

Quizplus · Accepted Answer

If the current price for a half gallon of milk is below the equilibrium price, there will be excess demand or a shortage. This will cause the quantity demanded to increase and the quantity supplied to decrease, as producers are unable to meet the higher level of demand. As a result, prices will rise to the equilibrium level. Therefore, the correct answer is D, as market forces would not cause the quantity supplied to decrease in this scenario.

If the Equilibrium Price for a Half Gallon of Organic