Price of a commodity is determined where ____.

Supply equals demand

The correct answer is Option 3: Supply equals demand

• The price of a commodity is determined at the equilibrium point, where quantity demanded equals quantity supplied.
• At this point, the market is in equilibrium, meaning there is no excess demand or excess supply.

Let's analyze the other options:

• Demand exceeds supply – Incorrect, as this leads to shortages and rising prices, not equilibrium.
• Supply exceeds demand – Incorrect, as this leads to surpluses and falling prices, not equilibrium.