What will happen if the price prevailing in the market is (i) Above the equilibrium price ? (ii) Below the equilibrium price ?

What will happen if the price prevailing in the market is (i) Above t

1.	What will happen if the price prevailing in the market is (i) Above the equilibrium price ? (ii) Below the equilibrium price ?
Answer» <html><body><p></p>Solution :(i) When the market <a href="https://interviewquestions.tuteehub.com/tag/price-1165141" style="font-weight:bold;" target="_blank" title="Click to know more about PRICE">PRICE</a> is above the equilibrium price there will be excess <a href="https://interviewquestions.tuteehub.com/tag/supply-1235254" style="font-weight:bold;" target="_blank" title="Click to know more about SUPPLY">SUPPLY</a> i.e., the <a href="https://interviewquestions.tuteehub.com/tag/quantity-1174212" style="font-weight:bold;" target="_blank" title="Click to know more about QUANTITY">QUANTITY</a> <a href="https://interviewquestions.tuteehub.com/tag/demanded-7675308" style="font-weight:bold;" target="_blank" title="Click to know more about DEMANDED">DEMANDED</a> is <a href="https://interviewquestions.tuteehub.com/tag/less-1071906" style="font-weight:bold;" target="_blank" title="Click to know more about LESS">LESS</a> than quantity supplied. <br/> (ii) When the market price is lower than the equilibrium price there will be excess demand i.e., the quantity demanded is more than the quantity supplied.</body></html>