Answer :
When addressing the situation where the quantity of a good supplied at a given price is greater than the quantity demanded, it's important to understand the basic principles of supply and demand in economics.
1. Excess Supply: This occurs when the quantity of a good supplied exceeds the quantity demanded at a given price. In this scenario, suppliers have more of the product than consumers are willing to buy at that price. This is sometimes referred to as a surplus. As a result, suppliers might reduce prices to encourage more demand or cut back production to reduce the excess inventory.
2. Stable Prices: This option would imply that the market is in equilibrium, where the quantity supplied equals the quantity demanded. However, in our scenario, there is an imbalance which contradicts stable prices.
3. Exact Equilibrium: This is a state where the quantity supplied exactly equals the quantity demanded. Given that the quantity supplied is greater than the quantity demanded, this does not apply to our situation.
4. Increased Production: This term would usually describe a scenario in which suppliers produce more goods. However, since there is already excess supply (meaning not all produced goods are being sold), it wouldn't make sense to increase production further.
Given these definitions, the correct interpretation of a situation where the quantity of a good supplied is greater than the quantity demanded is 'excess supply'. Therefore, the correct answer is:
Excess Supply
1. Excess Supply: This occurs when the quantity of a good supplied exceeds the quantity demanded at a given price. In this scenario, suppliers have more of the product than consumers are willing to buy at that price. This is sometimes referred to as a surplus. As a result, suppliers might reduce prices to encourage more demand or cut back production to reduce the excess inventory.
2. Stable Prices: This option would imply that the market is in equilibrium, where the quantity supplied equals the quantity demanded. However, in our scenario, there is an imbalance which contradicts stable prices.
3. Exact Equilibrium: This is a state where the quantity supplied exactly equals the quantity demanded. Given that the quantity supplied is greater than the quantity demanded, this does not apply to our situation.
4. Increased Production: This term would usually describe a scenario in which suppliers produce more goods. However, since there is already excess supply (meaning not all produced goods are being sold), it wouldn't make sense to increase production further.
Given these definitions, the correct interpretation of a situation where the quantity of a good supplied is greater than the quantity demanded is 'excess supply'. Therefore, the correct answer is:
Excess Supply
