Market equilibrium happens when the amount of a product that people want to buy matches the amount available to sell at a specific price. This balance helps keep prices stable.
For example, if more people want to buy a product and demand goes up by 20%, but the supply stays the same, there will not be enough of that product. This shortage will likely cause the prices to rise.
On the other hand, when there is too much of a product available (this is called a surplus), prices can go down.
A good example of this occurred in the UK in 2020. They had too much dairy, which caused prices to drop by 7%.
So, in short, equilibrium helps keep prices steady, while disequilibrium can affect how much of something is available and how much it costs.
Market equilibrium happens when the amount of a product that people want to buy matches the amount available to sell at a specific price. This balance helps keep prices stable.
For example, if more people want to buy a product and demand goes up by 20%, but the supply stays the same, there will not be enough of that product. This shortage will likely cause the prices to rise.
On the other hand, when there is too much of a product available (this is called a surplus), prices can go down.
A good example of this occurred in the UK in 2020. They had too much dairy, which caused prices to drop by 7%.
So, in short, equilibrium helps keep prices steady, while disequilibrium can affect how much of something is available and how much it costs.