Shortage and Surplus in Economics
Explore the concepts of shortage and surplus, their causes, and effects on market equilibrium in this Grade 10 economics worksheet.
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Shortage and Surplus in Economics
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Read each question carefully and provide your best answer. For multiple-choice questions, circle the correct option.
1. What is the economic term for a situation where the quantity demanded exceeds the quantity supplied at a given price?
Surplus
Shortage
Equilibrium
Inflation
2. A surplus in the market typically leads to:
An increase in price
A decrease in price
No change in price
An increase in demand
1. A price ceiling set above the equilibrium price will always result in a shortage.
True
False
2. Technological advancements in production generally lead to a surplus if demand remains constant.
True
False
1. When the quantity supplied is greater than the quantity demanded, a occurs.
2. A is often caused by a price being set below the equilibrium price.
3. In a free market, prices tend to when there is a shortage.
1. Briefly explain how a market typically adjusts to eliminate a surplus.
2. Describe two potential causes of a shortage in a market.
The diagram below illustrates a basic supply and demand curve. Use it to answer the following question.
3. On the diagram above, if the price were set above point 'E', would that create a shortage or a surplus? Explain your reasoning.