Surplus

Surplus means there is more of a good or service available than people want to buy. In simple terms, a surplus happens when supply is greater than demand. Surpluses are important because they can lead to lower prices, unsold products, and changes in business decisions. When businesses have too much inventory, they may cut prices, reduce production, or offer discounts. For example, if a store has 1,000 jackets but only 300 customers want to buy them, the store has a surplus of jackets. A surplus is not the same as profit. Surplus means there is extra supply, while profit means a business earns more money than it spends.