state whether the following statement is true or false. explain . when the equilibrium price of a good is less than its market price, there will be competition among sellers.
Answers
Explanation:
Dear Student,
A higher market price than the equilibrium price means that there is an excess supply in the market. This will increase competition among the sellers selling that good, as the supplier who will be able to supply the extra goods earlier than the others will be able to capture the market and wipe out the profits.
Therefore, Statement is True. When the equilibrium price of a good is less than its market price, there will be competition among sellers.
Regards
Answer:
Dear Student,
A higher market price than the equilibrium price means that there is an excess supply in the market. This will increase competition among the sellers selling that good, as the supplier who will be able to supply the extra goods earlier than the others will be able to capture the market and wipe out the profits.
Therefore, Statement is True. When the equilibrium price of a good is less than its market price, there will be competition among sellers.
Regards