At the current market price for milk, the quantity of milk that sellers are willing and able to sell falls short of the quantity that buyers are willing and able to purchase.In this situation:

Question

Quizplus · Accepted Answer

The situation described indicates that there is excess demand (quantity demanded exceeds quantity supplied), which means that the current market price is below the equilibrium price. The market will try to reach equilibrium by increasing the price, which will encourage more producers to supply milk and discourage some buyers from purchasing it. Therefore, there will be upward pressure on price until the market reaches equilibrium.

At the Current Market Price for Milk, the Quantity of Milk