Question

Suppose that producers are charging a price that is higher than the equilibrium price. Will this create a surplus or shortage of goods? In 2-3 sentences, explain your answer.

Answer 1

this will create a surplus of your goods, because at the equilibrium point the buyers are happy, when the price exceeds equilibrium buyers are forced to pay more for a good than they can purchase economically and will search for the next best thing or not buy at all, which will lead to a surplus of goods.