The equilibrium price (EP) is the price where the demand for a product or service balances its supply. It helps maintain equality between the quantity demanded and quantity supplied. On a graph, the intersection of the demand and supply curves shows the equilibrium price.
C. never be the case. D. result in pressure for price to fall. Answer Key: A result in pressure for price to rise . 10.0 Points It is true that the equilibrium quantity will always go up if supply: A. and demand both increase.
Decreased market price (shortage): When the market price is lower than the equilibrium price, a shortage occurs. In case of a shortage, the quantity demanded exceeds the quantity supplied. Therefore, at a decreased market price, the producers are willing to supply less than what the consumers demand.