Market Equilibrium
Plain definition
Market equilibrium is the price at which quantity demanded equals quantity supplied. At this market-clearing price, every buyer willing to pay finds a seller willing to sell, and no unsold goods or unfilled orders remain.
In economics
Equilibrium is the prediction point of the supply-demand model: surpluses push prices down and shortages push prices up, so competitive markets gravitate toward it. It is efficient in a narrow sense — all mutually beneficial trades happen — but it says nothing about fairness, and shocks (costs, tastes, policy) move it to a new point.
Example
If concert tickets settle at 800 rupees where exactly 5,000 buyers and 5,000 seats match, that is equilibrium. At 500 rupees, buyers would want 8,000 tickets (a shortage); at 1,200 rupees, only 3,000 (a surplus). Price pressure moves the market back toward 800.
Equilibrium is often misread as the best or most fair outcome. It is simply the stable, market-clearing point — a monopolist's profit-maximizing price is also an equilibrium, and it can coexist with poverty. Also, equilibrium is not frozen: it is a moving target that changes whenever supply or demand shifts.