What term refers to the market situation where demand exceeds supply?

The term that accurately describes a market situation where demand exceeds supply is "shortage." A shortage occurs when consumers want to purchase more of a good or service than is actually available. In this scenario, the quantity demanded surpasses the quantity supplied, which typically leads to upward pressure on prices. When there’s a shortage, suppliers may respond by increasing prices or ramping up production to meet the higher demand.

In contrast, a surplus, by definition, occurs when supply exceeds demand, resulting in excess products that are not being sold. A deficit generally refers to a lack of something in broader economic terms, such as budget deficits or trade deficits, and does not specifically pertain to market supply and demand dynamics. Equilibrium describes a state where supply equals demand, meaning there is no excess or shortage in the market.