If the market for corn is in equilibrium, which of the following must be true?

• A. The price of corn is at its highest possible level.
• B. There is a persistent shortage of corn in the market.
• C. Producers are unable to sell all the corn they bring to market.
• D. The quantity of corn demanded equals the quantity of corn supplied.

Answer: (D)

Verified step by step guidance

1. Understand the concept of market equilibrium: it occurs when the quantity demanded by consumers equals the quantity supplied by producers at a certain price.
2. Recognize that at equilibrium, there is no excess supply (surplus) or excess demand (shortage), so producers can sell exactly what they bring to the market.
3. Analyze each statement: the price being at its highest possible level is not necessarily true in equilibrium, as equilibrium price depends on supply and demand conditions.
4. Identify that a persistent shortage means quantity demanded exceeds quantity supplied, which contradicts equilibrium conditions.
5. Conclude that the defining characteristic of equilibrium is that the quantity of corn demanded equals the quantity of corn supplied.