The condition ad = as refers to which type of equilibrium in a market?

• A. Market equilibrium
• B. Monopoly equilibrium
• C. Consumer equilibrium
• D. Producer equilibrium

Answer: (A)

Verified step by step guidance

1. Step 1: Understand the notation used in the condition. Here, \( a_d \) typically represents the quantity demanded, and \( a_s \) represents the quantity supplied in the market.
2. Step 2: Recall the definition of market equilibrium. Market equilibrium occurs when the quantity demanded equals the quantity supplied, meaning there is no excess demand or supply.
3. Step 3: Recognize that the condition \( a_d = a_s \) directly states that the amount consumers want to buy equals the amount producers want to sell.
4. Step 4: Connect this equality to the concept of market equilibrium, where the market clears at a certain price and quantity.
5. Step 5: Conclude that the condition \( a_d = a_s \) refers to Market equilibrium, as it describes the balance point in the market.