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The relationship between price asked and quatity supplied.
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∙ 13y ago
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When a surplus of a product will arise when price is above equilibrium or below equilibrium?
above equilibrium
What is Equilibrium price?
The price of a product when demand equals supply
What happens when the equilibrium price is lower than the market price?
When the market price is lower than the equilibrium price the price of the product will continue to rise. The price will rise until it equal the equilibrium price.
There will be a surplus of a product when?
price below the equilibrium level
True or false A price fixed below the equilibrium price of a product will cause a shortage of that product?
true
When a surplus of a product will arise when price is above equilibrium or below equilibrium?
above equilibrium
What is Equilibrium price?
The price of a product when demand equals supply
What happens when the equilibrium price is lower than the market price?
When the market price is lower than the equilibrium price the price of the product will continue to rise. The price will rise until it equal the equilibrium price.
What happens when the market price is lower than the equilibrium price?
When the market price is lower than the equilibrium price the price of the product will continue to rise. The price will rise until it equal the equilibrium price.
There will be a surplus of a product when?
price below the equilibrium level
When will there be a surplus of a product?
price below the equilibrium level
True or false A price fixed below the equilibrium price of a product will cause a shortage of that product?
true
What is the price at which consumers will purchase the same quantity of a product that suppliers will produce?
The equilibrium price is the price at which consumers will purchase the same quantity of a product that suppliers will produce.
What will cause a change in equilibrium price?
The equilibrium once disturbed by a price change, reacts based on which direction the price was changed. Higher prices reduce demand and increase supply, while lower prices increase demand and lower supply.
Why do suppliers use price rather than production to resolve problem excess deman?
If supply increases and demand remains unchanged then lower equilibrium price and higher quantity. Suppliers cannot be assured of product sale, and product equilibrium price may be lower than cost of product, due solely to market saturation
Can you explain why there is no pressure for the equilibrium price to change?
The equilibrium price exists when at that price supply and demand for a product are equal. Apparently at that price level everybody is happy and as long as nothing changes there will be no pressure. If it would arise because of an increase in eithersupply or demand, the price would no longer be an equilibrium price and it would shift to another - higher or lower - level.
The point at which supply meets demand and all of a product will usually be purchased is known as what?
equilibrium price
