Mon Prof Augmenté
Where a market price settles
Age 15 · Economics
Open to everyone until Friday, November 13
To keep it, print it while it is open.
Buyers want more when things are cheap, and sellers offer more when prices are high. The price where these two wishes meet is where the amount bought equals the amount sold.
In the picture
- Demand line: buyers want less as the price rises
- Supply line: sellers offer more as the price rises
- Equilibrium point: the amount bought equals the amount sold
- Equilibrium price: the price read on the axis at the crossing
Examples
- At a fruit stall, apples that sell out by noon show the price is too low, so the seller raises it.
- Concert tickets left unsold show the price is too high, so the seller lowers it.
Key takeaways
- Demand slopes down and supply slopes up, and they cross at one point.
- At the equilibrium price, the quantity bought equals the quantity sold.
Quiz: Where a market price settles (Age 15)
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What is true at the equilibrium price?
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When the price of something rises, what do buyers and sellers tend to do?
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How do the demand and supply lines behave?
The answers, each with its explanation, are in the app. This quiz is free there while the lesson is in the free week.
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