If prices are free to rise and fall,and supply and demand cross at a positive price,quantity combination,neither excess demand nor excess supply can persist in a market.

Question

Quizplus · Accepted Answer

This statement is true according to the law of supply and demand. If prices are free to adjust, they will eventually reach a point where the quantity demanded equals the quantity supplied, resulting in a market equilibrium with no excess supply or demand. This is known as the equilibrium price and quantity. Therefore, option A is correct.

If Prices Are Free to Rise and Fall,and Supply and Demand