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You are here: Home / Potpourri / Economics 101: Surplus

Economics 101: Surplus

Economics 101: Surplus

[This is part of the series: The Complete Guide To Economics 101.]

What is an economic surplus?

An Economic Surplus is an imbalance of supply and demand where quantity supplied is greater than quantity demanded.

This imbalance creates a surplus of available goods and services.

It is important to remember, surpluses are always caused by price floors.

An example of a surplus the minimum wage. There is a surplus of people willing to work at a set wage. This is called unemployment.

Graphically, a price floor looks like this:

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Filed Under: PotpourriTagged With: #Economics101

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