A shortage will exist if
A)the price is above the equilibrium price.
B)the price is below the equilibrium price.
C)there are not enough producers.
D)there are not enough consumers.
E)demand decreases.

Question

Quizplus · Accepted Answer

A shortage occurs when the demand for a good or service exceeds the supply at the current market price. This means that the price is below the equilibrium price, as the equilibrium price reflects the point at which the quantity supplied equals the quantity demanded. If the price were above the equilibrium price, there would be a surplus instead. The scarcity of producers or consumers, or a decrease in demand, could potentially affect the market dynamics, but they are not the sole determinants of a shortage.

A Shortage Will Exist If