-If at a certain price level the AS exceeds the AD then what are the implications?
A)There is a shortage of goods and services,and eventually prices will increase.
B)There is a surplus of goods and services,and eventually prices will increase.
C)There is a shortage of goods and services,and eventually prices will decrease.
D)There is a surplus of goods and services,and eventually prices will decrease.

Question

-If at a certain price level the AS exceeds the AD then what are the implications?
A)There is a shortage of goods and services,and eventually prices will increase. 
B)There is a surplus of goods and services,and eventually prices will increase. 
C)There is a shortage of goods and services,and eventually prices will decrease. 
D)There is a surplus of goods and services,and eventually prices will decrease.

Quizplus · Accepted Answer

When Aggregate Supply (AS) exceeds Aggregate Demand (AD), it means there is more supply of goods and services than demand for them. This surplus situation puts downward pressure on prices, leading to a decrease in prices as sellers try to clear their excess inventory.

-If at a Certain Price Level the AS Exceeds the AD