On a graph illustrating market equilibrium, which curve shows the demand portion of equilibrium?

• A. The downward-sloping demand curve
• B. The upward-sloping supply curve
• C. The marginal cost curve
• D. The equilibrium price line

Answer: (A)

Verified step by step guidance

1. Understand that in a market equilibrium graph, two main curves are typically shown: the demand curve and the supply curve.
2. Recall that the demand curve represents the relationship between price and quantity demanded, which usually slopes downward because as price decreases, quantity demanded increases.
3. Recognize that the supply curve shows the relationship between price and quantity supplied, which usually slopes upward because as price increases, quantity supplied increases.
4. Identify that the demand portion of equilibrium is represented by the downward-sloping demand curve, reflecting consumers' willingness to buy more at lower prices.
5. Note that the equilibrium price is found where the demand curve intersects the supply curve, but the equilibrium price line itself is not the demand curve.