Market equilibrium condition

Market equilibrium occurs at the price P* where the quantity demanded equals the quantity supplied, so there is no shortage or surplus. It is used to find the equilibrium price and quantity from demand and supply functions.

Q_{d} (P^{*}) = Q_{s} (P^{*})

Q_d(P^*)=Q_s(P^*)

What the symbols mean

$P^{*}$	equilibrium price
$Q_{d} (P)$	quantity demanded at price P
$Q_{s} (P)$	quantity supplied at price P

About this formula

FieldEconomics and finance
TopicMicroeconomics
LevelHigh school
Also calledsupply equals demand, equilibrium price condition, market clearing condition, equilibrium quantity demanded equals supplied, supply and demand equilibrium, market equilibrium equation

Write it in Obsidian

MathLive is a free visual math editor for Obsidian. Run Find a formula, type “market equilibrium condition”, and it goes into your note as editable LaTeX. You can also scan formulas from screenshots, PDFs and handwriting.

Get MathLive for Obsidian See how it works

What the symbols mean

About this formula

Write it in Obsidian

Related formulas