Multiple Choice
In a market where the equilibrium price is achieved when 25 units of a good are supplied, how many goods must be supplied to achieve equilibrium?
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3. The Market Forces of Supply and Demand
Market Equilibrium
Multiple Choice
In a standard supply and demand graph, where is the equilibrium point located?
A
At the highest point of the demand curve
B
At the lowest point of the supply curve
C
Where the supply curve meets the price axis
D
At the intersection of the supply and demand curves
Verified step by step guidance1
Understand that the equilibrium point in a supply and demand graph represents the price and quantity at which the quantity demanded by consumers equals the quantity supplied by producers.
Identify the demand curve, which typically slopes downward from left to right, indicating that as price decreases, quantity demanded increases.
Identify the supply curve, which usually slopes upward from left to right, showing that as price increases, quantity supplied increases.
Locate the point where the supply curve and the demand curve intersect; this intersection represents the equilibrium price and quantity.
Recognize that this equilibrium point is neither at the highest point of the demand curve, the lowest point of the supply curve, nor where the supply curve meets the price axis, but exactly where both curves cross.
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