Principles of Macroeconomics / Unit 2 MAC 0107 short lesson, about 20 seconds
Surplus and Shortage
Captions available
The idea
Above equilibrium, quantity supplied exceeds quantity demanded and there is a surplus. Below equilibrium, quantity demanded exceeds quantity supplied and there is a shortage.
In practice
Unsold stock builds up, so sellers cut the price; or buyers compete, so sellers raise it.
Where people slip
A surplus pushes the price down and a shortage pushes it up, so both press the market back toward equilibrium.
Your place on the trail
Every lesson rests on earlier ones and opens later ones. Tap any to jump.
Builds on
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