What is excess supply?

Excess supply is a form of allocative inefficiency where the supply of a good or service becomes greater than the demand for this good or service in the market. This often happens because the price for a good is set too high and thus the demand for the good falls down, as people may choose to buy alternative goods that are cheaper in price, or may forego buying the good altogether. This concept can be diagrammatically drawn on the excess supply curve.

CB
Answered by Chenab B. Economics tutor

2103 Views

See similar Economics GCSE tutors

Related Economics GCSE answers

All answers ▸

Explain the concept of price elasticity


Explain why a government budget deficit is likely to stimulate economic growth.


Why should the government consider the price elasticity of demand when imposing tax on goods?


Identify policies a government can use to achieve economic growth.


We're here to help

contact us iconContact ustelephone icon+44 (0) 203 773 6020
Facebook logoInstagram logoLinkedIn logo

© MyTutorWeb Ltd 2013–2025

Terms & Conditions|Privacy Policy
Cookie Preferences