The price and quantity at which supply and demand balance is called?

The price and quantity at which supply and demand balance is called?

• A. Equilibrium price and quantity
• B. Marginal benefit
• C. Variable costs
• D. Needs

Answer: (A)

Equilibrium is the price-quantity combination where the quantity supplied equals the quantity demanded. The price at this point is the equilibrium price and the corresponding quantity is the equilibrium quantity. This is the best answer because it identifies the exact balance where buyers and sellers agree on quantity, causing the market to clear under the given conditions. When the market sits at this point, there’s no inherent pressure for the price to change. If the price is above equilibrium, a surplus occurs; if it’s below, a shortage occurs. The other terms describe different ideas: marginal benefit is the extra satisfaction from one more unit, variable costs are costs that change with output, and needs refer to requirements rather than the market-clearing balance.

Equilibrium is the price-quantity combination where the quantity supplied equals the quantity demanded. The price at this point is the equilibrium price and the corresponding quantity is the equilibrium quantity. This is the best answer because it identifies the exact balance where buyers and sellers agree on quantity, causing the market to clear under the given conditions. When the market sits at this point, there’s no inherent pressure for the price to change. If the price is above equilibrium, a surplus occurs; if it’s below, a shortage occurs. The other terms describe different ideas: marginal benefit is the extra satisfaction from one more unit, variable costs are costs that change with output, and needs refer to requirements rather than the market-clearing balance.