Figure 3.12: FIGURE 3-12 Price Above Its Equilibrium Level Creates a Surplus
Figure 3.12: The market price of $3.50 is above the equilibrium price of $3. This creates a surplus: at a price of $3.50, producers would like to sell 11.2 trillion BTUs but consumers want to buy only 8.1 trillion BTUs, so there is a surplus of 3.1 trillion BTUs. This surplus will push the price down until it reaches the equilibrium price of $3.