Equilibrium price

The price where the amount people want to buy equals the amount sellers want to sell.

Also called: market price

Practice it

Supply and demand: Prices tend to rise when people want more of something than is available, and fall when there's more than people want.
Supply: How much of something sellers are willing to sell at each price. When the price goes up, sellers usually offer more.
Demand: How much of something people want to buy at each price. When the price goes up, people usually buy less.
Shortage: When people want to buy more of something than sellers have, usually because the price is too low.
Surplus: When sellers have more of something than people want to buy, usually because the price is too high.

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