A market shortage occurs when the quantity demanded of a good or service exceeds the quantity supplied at a given price. This means that consumers are willing to buy more of the product than producers are able to supply. It results in potential customers being unable to purchase the product, which can lead to price increases and a reduction in consumer surplus.

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A Market Shortage Is

Question 54

Multiple Choice

A market shortage is

A) The amount by which the quantity demanded exceeds the quantity supplied at a given price.
B) The result of a price floor.
C) A situation in which producers cannot sell all the goods and services that they are willing and otherwise able to sell.
D) The amount by which the cost of production exceeds the price of a good.

Correct Answer: