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Multiple Choice
Market saturation results from excess:
A
supply
B
equilibrium
C
price
D
demand
Verified step by step guidance
1
Understand the concept of market saturation: it occurs when a market can no longer absorb additional products or services because the quantity supplied exceeds the quantity demanded.
Recall the definitions of the terms: 'supply' refers to the amount of a product producers are willing to sell, 'demand' is the amount consumers are willing to buy, 'equilibrium' is the point where supply equals demand, and 'price' is the amount paid for a product.
Analyze the options in the context of market saturation: if there is excess supply, it means more goods are available than consumers want to buy, leading to saturation.
Recognize that excess demand would not cause saturation, but rather shortages, and equilibrium means supply and demand are balanced, so saturation is not related to equilibrium or price directly.
Conclude that market saturation results from excess supply, as this is when the market is flooded with more goods than consumers can purchase.