What does equilibrium quantity refer to?

Equilibrium quantity is defined as the quantity supplied and the quantity demanded at the equilibrium price in a market. This is where the supply and demand curves intersect, signifying a balance where consumers are willing to buy the same amount that producers are willing to sell. At this point, there is no surplus or shortage in the market, leading to an optimal allocation of resources.

When the price is at equilibrium, it reflects both the willingness of consumers to pay for goods and the cost of producing those goods, resulting in market stability. Any deviations from this equilibrium can result in changes in price and quantity in response to excess supply or demand, highlighting the importance of this concept in understanding market dynamics.