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Identify and summarize the similar dynamics of market forces presented. That means to say, teach me...

Identify and summarize the similar dynamics of market forces presented. That means to say, teach me step-by-step how the laws of supply and demand combine with basic assumptions about shortages and surpluses to lead to a concept of market equilibrium.

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Market equilbrium occurs where forces of supply and demand equalize. In other words supply is equal to demand. This happens only at price p

At any price above p say p1 supply is greater than demand by B-a. As a result there is surplus of the commodity which due to competition among sellers reduces prices until supply=demand at p. Similarly at any price below p like po demand is greater than supply by D-c. Thus there is shortage of quantity. As a result of competition between buyers for limited quantity price will rise until supply=demand at p.

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