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What is Market Equilibrium?

Category: Marketing

1Definition

The point where quantity supplied equals quantity demanded, determining market price.

2Context

At equilibrium, no pressure exists to change price. Markets naturally move toward equilibrium.

3Example

At $3 per gallon, gas stations sell exactly as much as they produce—market equilibrium.

⚠Common Trap

Equilibrium is theoretical—real markets constantly adjust and never quite reach it.

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