Question

In equilibrium situation

• A. The amount to be sold is equal to the amount to be purchased
• B. Market supply is equal to market demand
• C. Neither the firm nor the consumer wants to be destabilised
• D. All of these

Hint:

Think of equilibrium as a point of "balance" or "rest" in a market. At this point, demand equals supply, and no one has an incentive to change their behavior.

Answer 1

The Correct Option is D

Economic equilibrium is a state of balance where economic forces are equal. In the context of a market:

(A) and (B): The fundamental condition for market equilibrium is that the quantity demanded by consumers equals the quantity supplied by producers. This means the total amount people want to buy is exactly equal to the total amount firms want to sell. So, market demand equals market supply.
(C): Equilibrium is a point of stability. At the equilibrium price, both consumers and firms have optimized their choices. There is no incentive for a consumer to change their consumption pattern or for a firm to alter its production level, as any deviation would make them worse off. It's a state of rest.
Since all three statements accurately describe an aspect of the equilibrium situation, the correct answer is (D).