If the price of a commodity is fixed below equilibrium, this will lead to

  • A excess demand
  • B a decrease in price
  • C an increase in price
  • D excess supply
jamb 2013economics

The correct answer is A. excess demand

If the price of a commodity is fixed below the equilibrium price, it will lead to excess demand.

This is because, at a price below equilibrium, the quantity demanded will exceed the quantity supplied, resulting in excess demand or a shortage of the commodity.

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