Question

A market is said to be in disequilibrium if a. it exhibits either a surplus or a shortage. b. the number of units that individuals are willing to buy exceeds the number of units they can afford. c. it is a market for an inferior good. d. none of the above

Answer 1

Option a

Step-by-step explanation:

The state of disequilibrium in the market arise, when the price prevailing in the market is either higher or lower than the equilibrium price.

The condition of disequilibrium results from the disparity in the quantity of the goods in demand and the quantity that is supplied. There are two conditions that results, i.e., either a shortage or surplus.

Equilibrium Price:

Equilibrium Price also known as Market Clearing Price is the price at which the quantity of a good or commodity demanded is the same or equal to that of the supplied quantity.