Shortages
If the selling price of the object is too low ( Below equilibrium ) then the quantity demand will increase which will also increase supply. This could create shortage in market
As p1 touches qD , supply is only qS thus demand exeeds supply but if its on price E then the maket status would be equilibrium
Surpluses
Excess supply occurs when the supply is greater than the demand
It can occur when prices are too high or when demand falls unexpectedly
During the later stages of the pandemic the market for face masks was in disequilibrium
Condition of the market
This market is in disequilibrium
Sellers are frustrated that the masks are not selling and that the price is obviously too high
Some buyers are frustrated as they want to purchase the masks but are not willing to pay the high price
Sellers will gradually lower prices in order to generate more revenue
This causes a contraction in QS as some sellers no longer desire to supply masks
This causes an extension in QD as buyers are more willing to purchase masks at lower prices