At any disequilibrium price,whether government controlled or not,the quantity actually exchanged is determined by
A)the elasticity of supply.
B)the elasticity of demand.
C)government decree.
D)the lesser of quantity demanded and quantity supplied.
E)the greater of quantity demanded and quantity supplied.

Question

Quizplus · Accepted Answer

At any disequilibrium price, the quantity actually exchanged is determined by the lesser of quantity demanded and quantity supplied. This is because if quantity demanded is greater than quantity supplied, there will be shortage and if quantity supplied is greater than quantity demanded, there will be surplus. The market will eventually adjust to reach equilibrium where quantity demanded equals quantity supplied, but until then, the actual quantity exchanged will be determined by the lesser of the two.

At Any Disequilibrium Price,whether Government Controlled or Not,the Quantity Actually