Which statement is true regarding a market in equilibrium? a

Marketing Jan 12, 2021

Which statement is true regarding a market in equilibrium?

a. There is a shortage of the good.

b. There is a surplus of the good.

c. Neither demanders or suppliers are satisfied.

d. Both demanders and suppliers are satisfied.

Expert Solution

The answer is d).

In a market equilibrium, the quantity demanded is equal to the quantity supplied, hence there is no excess demand or excess supply. In other words, at the equilibrium price, the consumers are buying exactly the amount of goods they are willing to purchase at the price, and firms are selling the exact amount of goods they are willing to sell at the market price. Hence both demanders and suppliers are satisfied.

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