Equilibrium Price · 1 min read

Equilibrium Price

This is the price where the amount of things people want to buy matches the amount of things sellers have to sell.

Equilibrium price is the market price where the quantity of goods supplied is equal to the quantity of goods demanded.

It is the price that makes both the buyer and the seller happy at the same time.

Goods supplied = Goods demanded.

This price happens at the exact spot where the line for buying and the line for selling cross each other on a graph.

It is also the point where the demand and supply curves in the market intersect.

At this point, there is no waste and no shortage because everything produced is bought.

Key points

•The equilibrium price is the market price.
•At equilibrium price, the quantity of goods supplied is equal to the quantity of goods demanded.
•The equilibrium price occurs at the point where the demand and supply curves intersect in the market.