The point at which the supply curve and the demand curve intersect is called:
A) equilibrium, because quantity demanded equals quantity supplied so there is no tendency for price to change.
B) equilibrium, because quantity demanded exceeds quantity supplied so there is a shortage.
C) equilibrium, because quantity supplied exceeds quantity demanded so there is a surplus.
D) irrelevant, because real-world prices never reach this point.

Question

Quizplus · Accepted Answer

The intersection of the supply and demand curves is called equilibrium because at this point, the quantity demanded equals the quantity supplied, resulting in no tendency for the price to change.

The Point at Which the Supply Curve and the Demand