When a Market Is in Equilibrium

question 58

Multiple Choice

When a market is in equilibrium,

• A)there is neither a surplus nor a shortage.
• B)the number of buyers equals the number of sellers.
• C)firms are producing the maximum quantity possible given the existing technology.
• D)supply equals demand.
• E)the quantity supplied is greater than or equal to the quantity demanded.

---

Definitions:

Market Outcome

The result of all the buying and selling activities on the market prices, quantities sold, and quantities produced of goods and services.

Domestic Price

The price at which goods and services are sold within a country's borders, as opposed to international or export prices.

Subsidy

A benefit given by the government to groups or individuals, usually in the form of a cash payment or tax reduction, to remove some type of burden and is considered to be in the interest of the public.

Consumers

Individuals or entities that purchase goods or services for personal use and not for manufacturing or resale.