rising profit, because in case of scarcity, the price signal induces producers to increase their capacity because rising price means rising profitability.
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in a market economy, a high price is a signal for?
producers to supply more and consumers to buy less.
A mixed economy can use the price mechanism to solve basic economy problem by eliminating a surplus if there is a surplus of goods causing the problem. This will cause the market price of those goods to drop. The price mechanism can also be used to expand suppliersâ?? production of a certain good when prices are rising because there is a high customer demand for that good.
These are different ways of describing an economy. A self-regulating economy is one that is in effect with no government or outside regulation and interference. The mechanism by which an economy self regulates is via price. If the price in the market is too high to gain a sufficient demand, the price will be driven down in a "self-regulatory" manner until the price is at a point that allows the economy to be in a general state of equilibrium, which is the point where supply equals demand. A competitive market is a vague definition of a market. Markets are generally classified by the type of competition present in the system. A perfectly competitive market is a market in which each supplier has an identical product and can not influence the price in the market, if they raise the price even a little bit, all of their sales would go to another firm in which the price is cheaper. There are monopolies (one firm) oligopolies ( a few firms) and other types of markets that are defined by competitiveness. The major distinction here is that self-regulation happens over many markets and can not be compared to a certain type of market.
if the market price imposed by suppliers are too high for consumers then the price ceilings are imposed....if the market price is too low for the producers then price floors is imposed.
in a market economy, a high price is a signal for?
producers to supply more and consumers to buy less.
A mixed economy can use the price mechanism to solve basic economy problem by eliminating a surplus if there is a surplus of goods causing the problem. This will cause the market price of those goods to drop. The price mechanism can also be used to expand suppliersâ?? production of a certain good when prices are rising because there is a high customer demand for that good.
rises, it means that there is high demand for a product or service but limited supply. The increase in price serves as a signal to suppliers and encourages them to increase production to meet the demand. However, if the shortage persists, it can lead to prolonged high prices and potential imbalances in the market.
These are different ways of describing an economy. A self-regulating economy is one that is in effect with no government or outside regulation and interference. The mechanism by which an economy self regulates is via price. If the price in the market is too high to gain a sufficient demand, the price will be driven down in a "self-regulatory" manner until the price is at a point that allows the economy to be in a general state of equilibrium, which is the point where supply equals demand. A competitive market is a vague definition of a market. Markets are generally classified by the type of competition present in the system. A perfectly competitive market is a market in which each supplier has an identical product and can not influence the price in the market, if they raise the price even a little bit, all of their sales would go to another firm in which the price is cheaper. There are monopolies (one firm) oligopolies ( a few firms) and other types of markets that are defined by competitiveness. The major distinction here is that self-regulation happens over many markets and can not be compared to a certain type of market.
A product or service has to be sold at a price that is high enough to be profitable, but not so high that it makes you vulnerable to competitors who can sell at a lower price and take all your customers away from you. So, it is a constant balancing act. Some businesses get it wrong, and consequently fail.
if the market price imposed by suppliers are too high for consumers then the price ceilings are imposed....if the market price is too low for the producers then price floors is imposed.
a signal that makes coustermers buy more supplies from te companies
High Taxes , High Especulate MArket , (Stock MArkert), Good Opportunity
Command economy, due to the imperfect market it always creats, it shall always supply economic goods(scarcity) in the market to alow high demand, hence monopoly of the market.
MVP: Market Value Price of something...
market conditions are responsible for price setting, as thing in perfect market are homogeneous, any different product with special feature would have a high price for it .