Understanding Market Equilibrium

This lesson explores Market Equilibrium, the point where Quantity Demanded equals Quantity Supplied. The graph shows a linear demand curve, P = 20 − 2Q, and a linear supply curve, P = 2Q. The equilibrium occurs where the two curves intersect, determining the market equilibrium price and quantity.

How to Use the Playground

• Drag the dot and the price line on the graph to observe how the market equilibrium changes.
• Use the sliders, or +/− buttons (on mobile) to adjust the market conditions.
• Watch the equilibrium price and equilibrium quantity update automatically whenever the graph moves.