In quarter 5 the demand is 8,472,091 units and supply is 8,687,459 units at equilibrium. In quarter 6 supply inccreased to 9,593,212 and demand to 8,725,230.
Is the market getting closer to short-run equilibrium where market demand is equal to market supply?
A. The market demand and supply moved closer to equilibrium. The gap between market demand and supply has decreased from quarter 5 to 6, even though the gap still exceeds 2 percent of market supply.
B. The market demand and supply is not moving closer to equilibrium. The gap between market demand and supply has increased from quarter 5 to 6; and currently exceeds 5 percent of market supply in quarter 6.
C. The market is near equilibrium in the last quarter. The market demand is within 2 percent of market supply.
D. None of the above.