0
What else can I help you with?
What is equilibrium price in economics?
It is the price where demand equals supply in a competitive market.
In a competitive market the equilibrium price and quantity occur where?
When demand curve intersects the supply curve.
Assume in a competitive market that price is initially below the equilibrium level. We can predict that price will?
In a competitive market, when the price is initially below the equilibrium level, there will be excess demand as consumers are willing to buy more at the lower price. This increased demand will lead to upward pressure on the price, as suppliers respond to the higher demand by raising their prices. Eventually, the price will rise until it reaches the equilibrium level, where quantity supplied equals quantity demanded.
A purely competitive firm is precluded from making economic profit in the long run because?
it is a price taker
What happen if price floor is above equilibrium price?
In a competitive market, it will produce an excess of supply (for the floor price, supply is bigger than demand)
What is equilibrium price in economics?
It is the price where demand equals supply in a competitive market.
What will happen if an individual perfectly competitive firm charges a price above the industry equilibrium price?
If an individual in a perfectly competitive firm charges a price above the industry equilibrium price this is bad. This company will go out of business quickly because their customers will go find the lower price.
In a competitive market the equilibrium price and quantity occur where?
When demand curve intersects the supply curve.
Assume in a competitive market that price is initially below the equilibrium level. We can predict that price will?
In a competitive market, when the price is initially below the equilibrium level, there will be excess demand as consumers are willing to buy more at the lower price. This increased demand will lead to upward pressure on the price, as suppliers respond to the higher demand by raising their prices. Eventually, the price will rise until it reaches the equilibrium level, where quantity supplied equals quantity demanded.
A purely competitive firm is precluded from making economic profit in the long run because?
it is a price taker
What happen if price floor is above equilibrium price?
In a competitive market, it will produce an excess of supply (for the floor price, supply is bigger than demand)
How do you find selling price?
In a perfectly competitive market, it is equal to marginal cost, it is also the point of equilibrium.
What factors determine the equilibrium price and quantity for a perfectly competitive firm in the long run?
In the long run, the equilibrium price and quantity for a perfectly competitive firm are determined by factors such as production costs, market demand, and competition from other firms. The firm will adjust its output level until it reaches a point where marginal cost equals marginal revenue, resulting in an equilibrium price and quantity.
Price can be substituted for marginal revenue in the MR equal MC rule when an industry is purely competitive because price?
Is constant regardless of the quantity demanded.
Is a purely competitive firm a price taker?
Indeed it is. A competitive market means that there are a lot of companies that sell the same product. With this conditions, if a company rise the price, consumers will easily find another company, losing all profits. Therefore a firm cannot control the price in a competitive market, it has to take the market price.
What is meant by the equilibrium price?
It is the price where demand equals supply in a competitive market.
What would the equilibrium price and quantity be in a oligopoly market?
In an oligopoly market, the equilibrium price and quantity are determined by the interdependent pricing and output decisions of a few dominant firms. These firms often engage in strategic behavior, such as price collusion or price wars, which can lead to higher prices and lower quantities compared to a competitive market. The equilibrium is reached when firms balance their production levels with market demand while considering their competitors' actions. As a result, the equilibrium price may be higher and the quantity lower than in more competitive market structures.
