Which of the following typically occurs during market disequilibrium?

• A. All buyers and sellers are satisfied at the current price.
• B. The quantity supplied equals the quantity demanded.
• C. Market price remains stable at the equilibrium level.
• D. There is either a surplus or a shortage in the market.

Answer: (D)

Verified step by step guidance

1. Understand the concept of market equilibrium: it occurs when the quantity demanded by buyers equals the quantity supplied by sellers at a certain price, leading to a stable market price.
2. Recognize that during market disequilibrium, the market price is not at the equilibrium level, so the quantity demanded and quantity supplied are not equal.
3. Identify that if the quantity supplied exceeds quantity demanded, a surplus occurs, meaning there are more goods available than buyers want to purchase at that price.
4. Identify that if the quantity demanded exceeds quantity supplied, a shortage occurs, meaning there are more buyers wanting the good than the amount available at that price.
5. Conclude that during disequilibrium, the market experiences either a surplus or a shortage, causing pressure for the price to adjust toward equilibrium.