Want this question answered?
A shortage could cause a black market because there is limited amount of supply. It also could cause sellers to discriminate on who gets to buy the limited amount of supply.
A lack of product (a.k.a. a shortage) would primarily cause an increase in the price of the good or service. An increased price means more supply, but it also means less demand.
yes, because when government impose price ceiling, the supply will decrease,but demand will increase, it will cause shortage, so it causes wasted resources.
beef shortage
A price ceiling will undermine the rationing function of market-determined prices by creating a shortage. This is a price which is below equilibrium which will lead to more demand that supply that will cause a shortage.
A shortage could cause a black market because there is limited amount of supply. It also could cause sellers to discriminate on who gets to buy the limited amount of supply.
A lack of product (a.k.a. a shortage) would primarily cause an increase in the price of the good or service. An increased price means more supply, but it also means less demand.
yes, because when government impose price ceiling, the supply will decrease,but demand will increase, it will cause shortage, so it causes wasted resources.
beef shortage
A price ceiling will undermine the rationing function of market-determined prices by creating a shortage. This is a price which is below equilibrium which will lead to more demand that supply that will cause a shortage.
Three examples that cause supply to increase are overproduction, inflation and lack of demand. Lack of demand for supply can create the supply to increase eventually.
No, an increase in supply without a change in demand will cause the price to fall.
Make or stock more but sell higher until supply meets demand, usually selling at a fair market price will cause higher volumes of sales because more can afford it. Conversely, too much supply will cause you to sell for less until demand meets supply !
An increase in supply will cause a decrease in demand. The value of what is being supplied would also drop.
The supply of goods exceeded the demand
The supply of goods exceeded the demand
The supply of goods exceeded the demand