If quantity demanded exceeds quantity supplied, we know that:

Question

Quizplus · Accepted Answer

If quantity demanded exceeds quantity supplied, it means there is excess demand in the market. This will lead to a shortage of the good, and consumers may bid up the price in order to obtain the limited supply. Therefore, the market price is likely to be higher than the equilibrium price, which is the price level at which supply and demand are balanced. So, option B is the correct answer.

If Quantity Demanded Exceeds Quantity Supplied, We Know That