1. What is Equilibrium Value?

The equilibrium value is the price at which quantity demanded equals quantity supplied in a market. It represents the point where market forces are balanced and there is no tendency for change.

2. How Does the Calculator Work?

The calculator uses the equilibrium condition:

Where:

• \( D \) — Demand function
• \( S \) — Supply function

Explanation: The calculator sets the demand function equal to the supply function and solves for the equilibrium price.

3. Importance of Equilibrium Calculation

Details: Determining equilibrium price is fundamental in economics for understanding market dynamics, price formation, and resource allocation.

4. Using the Calculator

Tips: Enter the mathematical expressions for demand and supply functions. Use standard mathematical notation with variables like P for price.

5. Frequently Asked Questions (FAQ)

Q1: What is market equilibrium?
A: Market equilibrium occurs when the quantity demanded equals the quantity supplied, resulting in a stable market price.

Q2: How do you find equilibrium price?
A: Set the demand function equal to the supply function (D = S) and solve for the price variable.

Q3: What happens when price is above equilibrium?
A: When price is above equilibrium, quantity supplied exceeds quantity demanded, creating a surplus.

Q4: What happens when price is below equilibrium?
A: When price is below equilibrium, quantity demanded exceeds quantity supplied, creating a shortage.

Q5: Can equilibrium change over time?
A: Yes, equilibrium can shift due to changes in factors like consumer preferences, technology, input prices, or government policies.