0
Explain why the price in competitive markets down at the equilibrium intersection of supply and demand explain what happens if the market price starts out too high or too low?
Wiki User
∙ 11y ago
On the other hand, from the producers point of view (the law of supply), if he's making more profit, he'll want to make more, and if he's making less profit he'll want to produce less of it.
So as the price and profit goes up, the quantity supplied goes up also.
Therefore the best amount to charge is the equilibrium price; where the consumer will be happy to buy it and the producer will be happy to sell it.
That is why the price in competitive markets settles down at the equilibrium intersection of supply and demand.
If the market price starts out too high, there will be little demand since it will be so expensive, and if the market price starts out too low, there will be little supply, because the producers are not gaining much profit from it.
Wiki User
∙ 11y ago
Add your answer:
Earn +20 pts
Explain the consumer equilibrium with the help of indifference curve?
Explain the consumer equilibrium with the help of indifference curve?
Explain how equilibrium in international market can be achieved and what factors can influencing its equilibrium?
== ==
Define the term equilibrium Explain the changes in market equilibrium and effects to shifts in supply and demand?
madarchode machudda
What is consumer equilibrium under cardinal approach?
illustrate and explain e the consumer equilibrium ender cardinalist and ordinalist?
Explain how monopoly causes an inefficient allocation of resources when the competitive firm does not even when both seek to maximize profits?
Explain how monopoly causes an inefficient allocation of resources when the competitive firm does not even when both seek to maximize profit
Explain the producer's equilibrium?
Explain the producer's equilibrium?
Explain the consumer equilibrium with the help of indifference curve?
Explain the consumer equilibrium with the help of indifference curve?
Explain how equilibrium in international market can be achieved and what factors can influencing its equilibrium?
== ==
How do you use competitive model to explain the law of competitive exclusion?
Justin Bieber
Explain chemical equilibrium shifts to favor products?
when a system is in equilibrium it is stable and all its parts function smoothly
Define the term equilibrium Explain the changes in market equilibrium and effects to shifts in supply and demand?
madarchode machudda
What is consumer equilibrium under cardinal approach?
illustrate and explain e the consumer equilibrium ender cardinalist and ordinalist?
Explain how monopoly causes an inefficient allocation of resources when the competitive firm does not even when both seek to maximize profits?
Explain how monopoly causes an inefficient allocation of resources when the competitive firm does not even when both seek to maximize profit
Explain statically indeterminate structure?
The structures which cannot be solved by the equilibrium equation are known as indeterminate structures.
What words can explain basketball?
Words to explain Basketball: tough, rough, competitive, fun, hard work, practice, losing, winning, ties, free-throws, fouls, and exciment.
The concept of competitive advantage is as important for non-profit organizations as it is for?
"The concept of competitive advantage is as important for non-profit organizations as it is for profit organizations". Do you agree with this statement or not? Explain with examples to justify your answer. "The concept of competitive advantage is as important for non-profit organizations as it is for profit organizations". Do you agree with this statement or not? Explain with examples to justify your answer.
For a given increase in supply the slope of both demand curve and supply curve affect the change in equilibrium quantity Is this statement true or false Explain with diagrams?
For a given increase in supply the slope of both demand curve and supply curve affect the change in equilibrium quantity Is this statement true or false Explain with diagrams?
