Starting from an initial equilibrium price, a surplus at that price can be created either by an increase in supply or a decrease in demand.

Name: Starting from an initial equilibrium price, a surplus at that price can be created either by an increase in supply or a decrease in demand.
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Question

Quizplus · Accepted Answer

When supply increases or demand decreases, the equilibrium price will remain unchanged initially, but there will be a surplus at that price as the quantity supplied exceeds the quantity demanded.

Starting from an Initial Equilibrium Price, a Surplus at That