A brown and blue economic supply and demand graph illustrating surplus, market price, price reduction, and quantity.

The market price exceeds the equilibrium price when a surplus emerges. The high market price leads producers to supply more products than consumers want to purchase, resulting in unsold inventory. The surplus requires producers or retailers to decrease their prices for market clearance. The price reduction leads to increased demand while decreasing supply until the market reaches equilibrium at the point where no surplus exists. See more