When a Market Is in Equilibrium

question 3

Multiple Choice

When a market is in equilibrium,

• A) the supply curve has the same slope as the demand curve.
• B) the number of buyers is exactly equal to the number of sellers.
• C) everyone has all they want of the commodity in question.
• D) there is no shortage and no surplus at the equilibrium price.

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Definitions:

Price To Charge

Price to Charge refers to the amount a business decides to set for its product or service, taking into account costs, competitive prices, and profit margins.

Marginal Costs

The additional cost incurred by producing one additional unit of a product or service.

Variable Costs

Costs that vary directly with the level of production, such as materials and labor, in contrast to fixed costs which remain constant regardless of production level.

Homogeneous Products

Goods that are identical in quality and features, making them interchangeable in the eyes of consumers.