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When a market is in equilibrium, the price of a good or service tends to stay the same. Equilibrium is the price at which the quantity demanded by consumers is equal to the quantity that's supplied by suppliers. When either demand or supply changes, however, the equilibrium price and quantity will also change. That's what we're talking about in this lesson - changes in the market equilibrium.

Let's look at some examples of changes in demand and supply, including an illustration of what happens when both demand and supply increase or decrease simultaneously. Before we begin, here's a helpful list of all the possible changes to equilibrium that you'll encounter in macroeconomics:

Overview of Changes in Equilibrium Prices

Shifts in the Demand Curve
(when supply is unchanged)
to the right means an increase in demand causes equilibrium to increase
to the left means a decrease in demand causes equilibrium to decrease

Shifts in the Supply Curve
(when demand is unchanged)
to the right means an increase in supply causes equilibrium to decrease
to the left means a decrease in supply causes equilibrium to increase
As you can see, an increase in demand causes the equilibrium price to rise. On the other hand, a decrease in demand causes the equilibrium price to fall. An increase in supply causes the equilibrium price to fall, while a decrease in supply causes the equilibrium price to rise.

for a detailed understanding, pls read http://education-portal.com/academy/lesson/how-changes-in-supply-and-demand-affect-market-equilibrium.html

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