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A commodity is an item marketed that is useful or valued. Competition, supply, and demand forces prices to go up in a perfect market.

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In a perfect market what forces price to go up in a commodity?

Lower supply and/or greater demand make prices for a commodity rise.


What is the difference between spot price and market price?

The spot price is the current price at which a commodity or asset can be bought or sold for immediate delivery, while the market price is the price at which a commodity or asset is currently trading in the market.


What type of market is the commodity market?

there are two types that are part of the commodity futures market. A normal futures market is one where the price of the nearby contract is less than the price of the distant futures contract. The other is an inverted futures market, the price of the near contract is greater then the price of the distant contract.


What type of company is the Commodity Futures market?

there are two types that are part of the commodity futures market. A normal futures market is one where the price of the nearby contract is less than the price of the distant futures contract. The other is an inverted futures market, the price of the near contract is greater then the price of the distant contract.


Two possible outcomes of disequilibrium Economic?

Market disequilibrium is market conditions yielding surplus or shortage: a market state in which the forces of demand and supply are not balanced, leading to price fluctuations that reflect a shortage or a surplus of a product or commodity.


How can country determine the price of the commodity?

Countries can determine the price of a commodity through various factors, including supply and demand dynamics, production costs, and market competition. Government policies, such as tariffs and subsidies, can also influence prices. Additionally, international market trends and exchange rates play a significant role in determining how commodities are priced in a global context. Ultimately, a combination of market forces and regulatory frameworks shapes commodity pricing within a country.


What is market price determined by?

the market or market forces


Why would the government wish to control the price of a commodity below the market equilibrium price?

Artificially keeping the price of a commodity below market value by governments (usually by selling massive quantities) is to try and achieve the appearance of a greater value in something else.


What is the market equilibrium?

Market equilibrium comes at the price of a commodity for balancing the market forces like demand & supply.In market equilibrium the amount that the buyers want to buy equal to the amount that the sellers want to sell.The reason we call this equilibrium,when the forces of demand & supply are in balance, there is no reason for a price to rise or fall as long as other factors remain unchanged.At equilibrium, quantity demanded equals quantity supplied.


How does the price system in a free market economy react to shortage of commodity?

Higher prices


Does a perfect competitive market have an influence over price?

In perfect copmetative marker there is no influence of price...


What are the importance of commodity exchange?

Several importances of commodity exchange include a fair relationship between a cash and futures market, leveraging, price risk management, price discovery, and liquidity.