Write a note on Market Equilibrium

The word “Equilibrium” is derived from a Latin word, which means equal balance. Equilibrium is the position from which there is no tendency to move. We say ‘Tendency’ to emphasize the fact that it is not necessarily a state of sudden inertia, but may instead represent the cancellation of power forces.

Equilibrium Price is the price at which the quantity demanded of a good or service is equal to the quantity supplied

In economics, Economic Equilibrium is simply a state of the world where economic forces are balanced and in the absence of external influences the (equilibrium) values of economic variables will not change. Market equilibrium, for example, refers to a condition where a market price is established through competition such that the amount of goods or services sought by buyers is equal to the amount of goods or services produced by sellers. This price is often called the equilibrium price or market clearing price and will tend not to change unless demand or supply change.