If at a particular price level, real output from producers is greater than real output desired by purchasers, then there will be a general:
A) Surplus and the price level will rise
B) Surplus and the price level will fall
C) Shortage and the price level will rise
D) Shortage and the price level will fall

Question

Quizplus · Accepted Answer

If real output from producers is greater than real output desired by purchasers, it means there is a surplus of goods in the market. This surplus will lead to a decrease in the price level, as producers will need to lower their prices in order to sell their excess goods. Therefore, choice B is correct.

If at a Particular Price Level, Real Output from Producers