Q2 of 15 Page 5

When do we say there is excess supply for a commodity in the market?

When the market supply exceeds market demand then there is an excess supply for a commodity in the market.


More from this chapter

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1

Explain market equilibrium.

 3

Explain how price is determined in a perfectly competitive market with fixed number of firms.

 4

How is the equilibrium number of firms determined in a market where entry and exit is permitted?

 5

How is the optimal amount of labour determined in a perfectly competitive market?