Economic Equilibrium

Economic equilibrium refers to a state in an economy where supply and demand are balanced. In this situation, the quantity of goods or services that producers are willing to sell matches the quantity that consumers are willing to buy, resulting in stable prices. When markets are in equilibrium, there are no excess surpluses or shortages, and the economy operates efficiently. If any changes occur, such as shifts in consumer preferences or production costs, the market will adjust over time to restore equilibrium, reflecting the dynamic nature of economic interactions.