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How is an equilibrium price determined?

A. By finding a price that meets the highest quantity demanded by
consumers
B. By finding a price that exceeds the expenses producers take on to
create supply
C. By finding a price that meets the highest quantity supplied by
producers
D. By finding the price where quantity supplied matches quantity
demanded

User Timv
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2 Answers

5 votes

Answer:

D

Step-by-step explanation:

User JoshGough
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5 votes

Answer:.

D. By finding the price where quantity supplied matches quantity

demanded

Step-by-step explanation:

Equilibrium price refers to a price point in which the Force of demand and supply in the market are balanced. (assuming that there are not other external forces that influenced the trades). Typically, neither the producer or the consumer have advantage over one another when transacting within that price point.

To find out a an equilibrium price, we need to find out the price point where quantity supplied matches quantity demanded. This point will provide us with the knowledge about the price which considered as "fair" for both parties and they felt that they obtained equal amount of value from the transactions.

User Martin Forte
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