When a surplus occurs in a market, suppliers may lower their prices to:

When a surplus occurs in a market, it indicates that the quantity supplied exceeds the quantity demanded at the current price. To address this imbalance, suppliers often respond by lowering prices. This price reduction has a direct effect on the market: it tends to increase the quantity demanded from consumers because lower prices make the product more attractive and affordable.

This price drop also indirectly affects the quantity supplied. If suppliers lower their prices in response to the surplus, some may reduce their production or supply of the product because decreased prices can lead to lower profits. Thus, while the initial focus is on increasing consumption through higher demand, it also leads to a potential decrease in supply as suppliers reevaluate their production strategies.

Therefore, the most comprehensive understanding of the dynamics in a surplus situation is captured by the answer that highlights not just the increase in quantity demanded, but also considers the likely decrease in quantity supplied. Both effects are significant in the context of addressing a surplus.