achieving equilibrium (supply and demand)

Question 1

equilibrium price

Answer 1

is the price at which the quantity demanded by buyers equals the quantity supplied by sellers; also called the market-clearing price

Question 2

equilibrium quantity

Answer 2

is the quantity demanded and quantity supplied at the equilibrium or market-clearing price

Question 3

surplus

Answer 3

is the situation that results when the quantity supplied of a product exceeds the quantity demanded; generally happens because the price of the product is above the market equilibrium price

Question 4

shortage

Answer 4

is the situation that results when the quantity demanded a product exceeds the quantity supplied; generally happens because the price of the product is below the market equilibrium price