Market Equilibrium, Shortage and Surplus · seed 1 · A4, ink-friendly. The answer key prints on its own page for grown-ups.
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Where the curves cross

Civics & Economics · Economics · ages 14-16
Name ______________________   Date ____________

  1. In the standard market model, equilibrium leaves no shortage or surplus.

    Circle one:   True   False

  2. What is market equilibrium?

    • The highest price
    • Matching quantities
    • A closed shop

  3. In the standard demand and supply model, price is above equilibrium. What builds up?

    • A surplus
    • A shortage
    • An equilibrium

  4. How does a surplus push the price back down?

    • Sellers discount stock
    • Buyers pay extra for fun
    • Shops order even more

  5. In the standard model, price is below equilibrium. Who cannot buy as much as they want at that price?

    • Sellers who sell out early
    • Buyers left empty-handed
    • Nobody at all

  6. When prices can adjust, how can buyers respond to a shortage and push price upward?

    • Sellers slash prices further
    • Buyers bid the price up
    • Shelves refill for free

  7. In the standard model, a legal ticket-price ceiling is set below equilibrium. What follows?

    • A shortage
    • A surplus, as sellers pile in
    • A calm clearing of the market

  8. A concert sells out, and more buyers remain willing and able to pay the ticket price. With a fixed number of seats, where is that price relative to the market-clearing price?

    • It sat above the crossing
    • It sat at the crossing
    • It sat below the crossing
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Answer key

For grown-ups. Fold this page away before handing over the rest.

Where the curves cross W1-mt_SarFx2o1IM-s1

  1. True · At equilibrium, quantity demanded equals quantity supplied.
  2. Matching quantities · At the crossing, wanted and offered agree and the shelf clears.
  3. A surplus · At that price, quantity supplied is greater than quantity demanded.
  4. Sellers discount stock · Discounts encourage buyers to take stock sellers cannot sell at the higher price.
  5. Buyers left empty-handed · Quantity demanded exceeds quantity supplied, so some planned purchases cannot happen.
  6. Buyers bid the price up · Buyers competing for scarce available units may offer a higher price.
  7. A shortage · The binding ceiling leaves quantity demanded above quantity supplied.
  8. It sat below the crossing · The remaining unsatisfied demand establishes a shortage at that price.
Worksheet · LightMySky