In a free market, if the price of a good is below the equilibrium price, then;
A)the government will set a higher price to reestablish the market equilibrium.
B)sellers, dissatisfied with growing inventories, will raise their prices.
C)buyers, hoping to ensure they acquire the good, will bid the price higher.
D)sellers, dissatisfied with growing inventories, will lower their prices.

Question

Quizplus · Accepted Answer

If price is below the equilibrium price, then there will be more buyers who want to buy a good than there will be sellers who wish to sell it. In this case, frustrated buyers have an incentive to offer to pay higher prices to obtain the good.

In a Free Market, If the Price of a Good