Which term can be used to describe the market condition where both buyers and sellers are satisfied?

The term that describes the market condition where both buyers and sellers are satisfied is equilibrium. In a state of equilibrium, the quantity of goods supplied is equal to the quantity of goods demanded at a certain price level. This balance means that sellers are able to sell all they want to produce at the prevailing price, while buyers are able to purchase all they desire at that price. When the market is in equilibrium, there is neither a surplus nor a shortage of goods, allowing for a stable market environment where both parties find their needs met without any pressure to change prices or quantities.

In contrast, surplus refers to a situation where there are more goods available than buyers are willing to purchase, leading to unsold products. A deficit, similar to a shortage, occurs when demand exceeds supply, creating pressure on prices to rise as buyers compete for limited goods. Shortage specifically indicates a market condition where the quantity demanded is greater than the quantity supplied at a given price, which often results in buyers being unable to purchase the goods they want at that price. Understanding these terms helps clarify the dynamics of how markets operate and makes it clear why equilibrium is a state of mutual satisfaction for both buyers and sellers.