When the price of a good is above its equilibrium price, a:
a. surplus puts upward pressure on the price.
b. surplus puts downward pressure on the price.
c. shortage puts upward pressure on the price.
d. shortage puts downward pressure on the price.
Question 2
If the quantity demanded of milk is 55,000 and the quantity supplied of milk is 80,000, then:
a. there is an excess supply of 25,000 units of milk.
b. the price of milk will tend to rise to clear the market.
c. consumers get the milk they want so market equilibrium exists.
d. there is an excess demand of 25,000 units of milk.
e. this is the intersection of market supply and demand curves.
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