Ten rupees is the equilibrium price for good X. If government fixes the price at Rs.5, there is

A shortage
A surplus
Excess supply
Loss

The correct answer is: A shortage.

A shortage occurs when the quantity demanded of a good is greater than the quantity supplied at the current price. In this case, the equilibrium price is 10 rupees, but the government has fixed the price at 5 rupees. This means that there is a shortage of good X, because consumers are willing to pay more than 5 rupees for the good, but sellers are only willing to sell it for 5 rupees.

The other options are incorrect because:

  • A surplus occurs when the quantity supplied of a good is greater than the quantity demanded at the current price. This is not the case in this situation, because the quantity supplied is equal to the quantity demanded at the equilibrium price of 10 rupees.
  • Excess supply is a synonym for surplus.
  • Loss is not a term that is typically used to describe a shortage. A loss is a decrease in the value of an asset, and this is not what is happening in this situation.
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