What happens when demand and supply curves do not intersect each other?

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What is meant by a non-viable industry?

Non-viable industry. A situation may arise when there are prospective consumers and producers of a commodity but still it is not produced. Why? It happens when the price at which producers are ready to produce is so high that the consumers are not willing to buy even a single unit of the commodity. In other words, graphically it means that the demand curve and supply curve do not intersect each other at any positive quantity as shown in Fig. 4.11. Mind, for a non-viable industry, supply curve lies above demand curve. Demand curve lying below supply curve indicates that there is no demand for the product of suppliers because the price is too high for the consumers. As a result product will not be produced. This shows the industry (of the product) is not economically viable. For instance, presently manufacturing of Commercial Aircrafts and Copying Machines in India is not economically viable whereas they are variable goods in U.S.A. and Russia.

Thus a non-viable industry is one whose demand and supply curves do not intersect each other at any positive quantity. It is an industry in which costs are too high for any positive output to be produced. When applied to the central problem of 'what to produce', it can be safely said that the good shown in Fig. 4.11 will not be produced whereas the one shown in Fig. 4.10 will be produced. Again if demand and supply curves of a commodity intersect, it shows that production of the commodity is economically viable and equilibrium can be attained.

Fig. 4.11