Question

Which of the following is the best example of what happens when equilibrium is reached?

a. all stores in a city are selling a certain model of television for $899
B. the number of televisions available at $899 is the same as the number of sales
C. some customers decide $899 is too high and buy a lower-cost television
D. a store that sells its television for $999 lowers its price to $899

Answer 1

Equilibrium is reached when the number of products available at a certain price equals the number of products sold. It reflects a market state where supply equals demand and prices become stable.

Step-by-step explanation:

The best example of what happens when equilibrium is reached is: the number of televisions available at $899 is the same as the number of sales. This scenario describes the state where the equilibrium price is such that the quantity of the product that consumers are willing to buy at this price matches exactly the quantity of the product that sellers are willing to offer. Equilibrium is a key concept in economics that occurs when market supply and demand are balanced, and as a result, prices become stable.

For instance, taking the example of the coffee market where at the equilibrium price of $4, consumers will purchase 200 million pounds of coffee, which is the same quantity that producers are willing to supply. In another scenario, if the equilibrium price of salmon falls from $3.25 to $2.50, the equilibrium quantity increases from 250,000 to 550,000 salmon, showing that sometimes a lower equilibrium price can lead to a higher quantity demanded and supplied in the market.