Question

There is a surplus of tomatoes in the market. This implies that:

A. The current price is set above the equilibrium level
B. The price will be rising, as a result
C. Supply of tomatoes is more than the demand
D. Quantity demanded is more than quantity supplied

Answer 1

A surplus of tomatoes in the market suggests that the supply is greater than the demand, usually because the price is above the equilibrium level. The correct option is C.

Step-by-step explanation:

When there is a surplus of tomatoes in the market, it implies that the supply of tomatoes is more than the demand for them. This usually occurs when the current price is set above the equilibrium level, where the quantity supplied exceeds the quantity demanded.

This is an excess supply or a surplus, and typically, economic pressures will push the price down towards the equilibrium level, not up. Therefore, a surplus does not imply that the price will be rising; in fact, it suggests the opposite.