ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -A market-clearing price is the price of a good or service at which quantity supplied is equal to quantity demanded, also called the equilibrium price.

Detailed explanation-2: -Equilibrium quantity is when there is no shortage or surplus of a product in the market. Supply and demand intersect, meaning the amount of an item that consumers want to buy is equal to the amount being supplied by its producers.

Detailed explanation-3: -An equilibrium price is a balance of demand and supply factors. There is a tendency for prices to return to this equilibrium unless some characteristics of demand or supply change. Changes in the equilibrium price occur when either demand or supply, or both, shift or move.

Detailed explanation-4: -Equilibrium is the state in which market supply and demand balance each other, and as a result prices become stable. Generally, an over-supply of goods or services causes prices to go down, which results in higher demand-while an under-supply or shortage causes prices to go up resulting in less demand.

Detailed explanation-5: -Equilibrium: Where Supply and Demand Intersect The equilibrium price is the only price where the desires of consumers and the desires of producers agree-that is, where the amount of the product that consumers want to buy (quantity demanded) is equal to the amount producers want to sell (quantity supplied).