when a demand curve and a supply curve for a particular item are overlaid on the same graph the point at which they intersect is referred to as the equilibrium point that s the price at which the quantity consumers are willing to buy and the quantity producers are willing to deliver are perfectly matched 
the bottom linethe theory of price in microeconomics states that the price of a particular good or service is determined by the relationship between producer supply and consumer demand at any given point prices should rise if demand exceeds supply and fall if supply exceeds demand when supply and demand are equal the market is said to have achieved equilibrium 