ELI5: Explain Like I'm 5

Excess demand function

Excess demand is a way of measuring how much people are willing to buy something compared to how much is available. The excess demand function is a way of showing this on a graph. It looks like an upside-down 'U' shape and shows how the amount of people wanting something changes when the price changes. If the price is too high, then not many people will want to buy it. If it is too low, then it won't be able to meet everyone's needs, so people will still want to buy it. The "sweet spot" is the price that meets both the consumer and seller's needs.