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Question
During a period if the equilibrium price is rupees 10 and the price fixed by the government is rupees 5, there is a __________.
During a period if the equilibrium price is rupees 10 and the price fixed by the government is rupees 5, there is a __________.
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Solution
The correct option is A shortage
A shortage is a situation in which demand for a good or
service exceeds the available supply. Possible causes of a shortage include
miscalculation of demand by a company producing a good or service, resulting in
the inability to keep up with demand, or government policies such as price
fixing or rationing. Natural disasters that devastate the physical landscape of
a region can also cause shortages of such essential products as food and
housing, also leading to higher prices of those goods.
A shortage is a situation in which demand for a good or
service exceeds the available supply. Possible causes of a shortage include
miscalculation of demand by a company producing a good or service, resulting in
the inability to keep up with demand, or government policies such as price
fixing or rationing. Natural disasters that devastate the physical landscape of
a region can also cause shortages of such essential products as food and
housing, also leading to higher prices of those goods.
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