When the supply of a commodity exceeds the demand prices generally rise.?

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1135742

2026-05-21 03:55

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Actually, when the supply of a commodity exceeds the demand, prices typically fall, not rise. This occurs because sellers may lower prices to encourage purchases when there is an excess of goods in the market. Conversely, if demand exceeds supply, prices tend to rise as consumers compete for the limited quantity available. Therefore, the balance between supply and demand is crucial in determining market prices.

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