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• # Equilibrium (Economics Lesson)

Economics

Inyang Umoh (tutor)
09-02-2016 06:38:00 +0000

The concept of equilibrium is often tested on JAMB and other exams. So lets take a quick look into this topic.

Shortage - In a market whenever the amount of the product consumers want to buy (quantity demanded) is greater than the amount producers want to sell (quantity supplied), there is a shortage in the market.

Surplus - Conversely, whenever the quantity demanded is less than the quantity supplied, there is a surplus.

Equilibrium - The equilibrium price is the only price where the consumers and producers agree — that is, where the amount of the product consumers want to buy (quantity demanded) is equal to the amount producers want to sell (quantity supplied).

This common quantity is called the equilibrium quantity. At any other price, the quantity demanded does not equal the quantity supplied, so the market is not in equilibrium at that price.

Can anyone provide examples in their everyday lives of a shortage, surplus and an market that's in equilibrium?

• Glory Uzochukwu67

pls explain further on this equilibrium, with examples

0 09-02-2016 14:11:00 +0000

1) example of a shortage - long queues for petrol because the price set by the government is too low and few sellers are willing to sell at that price 2) example of equilibrium - when you go to the market and you see enough meat to buy. The vast majority of buyers are willing to buy at the current price and the vast majority of sellers are willing to sell at the market price 3) example of surplus - by 8pm banana hawker reduce their price or even give or throw their bananas away

0 10-02-2016 06:28:00 +0000

• Yusuf Jubril

explain more

0 10-02-2016 09:25:00 +0000

@Yusuf Jubril, please tell us what you understand and what you don't. So we know where where you are having problem.

0 10-02-2016 09:32:00 +0000

• Suleiman Zakari

When ever dere is shortage that mean there is surplus

0 10-02-2016 11:15:00 +0000

• Suleiman Zakari

Am I ryt?????

0 10-02-2016 11:15:00 +0000

• Suleiman Zakari

Beside is all understandable

0 10-02-2016 11:22:00 +0000

• Suleiman Zakari

On my own understanding shortage and surplus are all desame but equilibrium is when a consumer price on his effective demand with the producer and day end up on a fix amount the consumer want........ Correct me pls if dere is eny correction

0 10-02-2016 11:37:00 +0000

• Inyang Umoh (tutor)

@suleiman - Shortage and surplus are two opposite things. Surplus is when there are many people selling at a certain price but not enough people buying. And shortage is when there are many people trying to buy at a certain price but not enough people selling at that price

0 13-02-2016 09:36:00 +0000

• Inyang Umoh (tutor)

@suleiman equilibrium is when normal state of things when there are enough buyers and sellers willing to exchange at the current price.

0 13-02-2016 09:38:00 +0000