What will happen if the price prevailing in the market is –

(i) Above the equilibrium price?


(ii) Below the equilibrium price?

If the price prevailing in the market is above the equilibrium price –

Then the demand will be less than the supply, it means a situation of excess supply will be in the market


If the price prevailing in the market is below the equilibrium price –


Then there will be more demand and less supply, it means situation of excess demand or shortage of supply.


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