When does a surplus occur?
A) When the quantity supplied is less than the quantity demanded
B) When the quantity demanded is less than the quantity supplied
C) When a market only sells secondary goods
D) When producers see a need to increase the price of the good

Question

Quizplus · Accepted Answer

A surplus occurs when the quantity supplied is greater than the quantity demanded. This means that there is an excess supply of a good or service, which can lead to price reductions in order to stimulate demand. Option A is incorrect because it describes a situation where there is a shortage, not a surplus. Option C is not necessarily true, and option D is irrelevant to the concept of surplus.

When Does a Surplus Occur