Which of the following is evidence of a surplus of bananas?
A)Firms raise the price of bananas.
B)The price of bananas is lowered in order to increase sales.
C)The equilibrium price of bananas rises due to an increase in demand.
D)The quantity of bananas demanded is greater than the quantity supplied.

Question

Quizplus · Accepted Answer

If there is a surplus of bananas, it means there is an excess supply of bananas in the market. This would result in firms lowering the price to increase sales and clear their inventory. Therefore, option B is the correct answer. Option A is incorrect because firms would not raise the price if there is a surplus as it would further decrease demand. Option C is incorrect because the equilibrium price would only rise if there is an increase in demand, not a surplus. Option D is incorrect because in a surplus, the quantity supplied is greater than the quantity demanded.

Which of the Following Is Evidence of a Surplus of Bananas