When a market is in equilibrium:

Question

Quizplus · Accepted Answer

When a market is in equilibrium, the quantity demanded and the quantity supplied are equal, and there is no excess demand or supply. This means that market forces exert no pressure for change in price. Producers may earn economic profits in the short run, but in the long run, these profits will attract more producers to enter the market, which will increase supply and lower prices, eventually leading to zero economic profit in the long run. Therefore, option C is the best choice. The other options are not characteristic of a market in equilibrium.

When a Market Is in Equilibrium