A market comprised of a downward-sloping demand curve and an upward-sloping supply curve is said to be stable because
A) price will never change.
B) quantity will never change.
C) demand will never change.
D) supply will never change.
E) at any price other than equilibrium,forces in the market move the price towards the equilibrium.

Question

Quizplus · Accepted Answer

A stable market means that the market is in equilibrium, where the quantity demanded equals the quantity supplied. However, if the market is not in equilibrium, forces in the market will push the market towards the equilibrium. Therefore, at any price other than the equilibrium price, there will be excess demand or excess supply which will cause the price to either increase or decrease, respectively, until the market reaches equilibrium. Hence, the correct answer is E- at any price other than equilibrium, forces in the market move the price towards the equilibrium.

A Market Comprised of a Downward-Sloping Demand Curve and an Upward-Sloping