(Figure: Supply, Demand, and Equilibrium) Use Figure: Supply, Demand, and Equilibrium. In the market illustrated in the figure,

Question

Quizplus · Accepted Answer

The point where the supply and demand curves intersect is the equilibrium point. In the given figure, P2 is the price at which demand and supply are equal (i.e., the equilibrium price), and Q2 is the quantity exchanged (i.e., the equilibrium quantity). Therefore, choice A is correct. Choice B is incorrect because P3 and Q1 do not represent the point of equilibrium. Choice C is incorrect because there is no information given about the actual quantity supplied or demanded. Choice D is incorrect because a rise in price would not shift the demand curve but would rather move along the given demand curve.