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What is the significance of the zero profit condition in economic theory?
The zero profit condition in economic theory is significant because it helps determine the equilibrium price and quantity in a competitive market. When firms earn zero profit, it indicates that resources are being allocated efficiently and that the market is in equilibrium. This condition also ensures that resources are being used in the most productive way, leading to overall economic efficiency.
The price of peanut butter rises due to a blight on the peanut crop. peanut butter and jelly are complements. What happens to the equilibrium quantity and price of jelly?
(A)Equilibrium price falls, equilibrium quantity increases (B) Equilibrium price rises, equilibrium quantity falls (C) Equilibrium price falls, equilibrium quantity falls (D) Equilibrium price rises, equilibrium quantity rises
What is another term for marketing clearing price?
equilibrium price
What equilibrium price and equilibrium quantity?
equilibrium price and equilibrium quantity?: equilibrium price: When the price is above the equilibrium point there is a surplus of supply The market price at which the supply of an item equals the quantity demanded Price at which the quantity of goods producers wish to supply matches the quantity demanders want to purchase sa madaling salita supply=demand=price equilibrium quantity: Amount of goods or services sold at the equilibrium price The quantity demanded or supplied at the equilibrium price. supply=demand ayos?
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 is the significance of the zero profit condition in economic theory?
The zero profit condition in economic theory is significant because it helps determine the equilibrium price and quantity in a competitive market. When firms earn zero profit, it indicates that resources are being allocated efficiently and that the market is in equilibrium. This condition also ensures that resources are being used in the most productive way, leading to overall economic efficiency.
The price of peanut butter rises due to a blight on the peanut crop. peanut butter and jelly are complements. What happens to the equilibrium quantity and price of jelly?
(A)Equilibrium price falls, equilibrium quantity increases (B) Equilibrium price rises, equilibrium quantity falls (C) Equilibrium price falls, equilibrium quantity falls (D) Equilibrium price rises, equilibrium quantity rises
What is another term for marketing clearing price?
equilibrium price
What equilibrium price and equilibrium quantity?
equilibrium price and equilibrium quantity?: equilibrium price: When the price is above the equilibrium point there is a surplus of supply The market price at which the supply of an item equals the quantity demanded Price at which the quantity of goods producers wish to supply matches the quantity demanders want to purchase sa madaling salita supply=demand=price equilibrium quantity: Amount of goods or services sold at the equilibrium price The quantity demanded or supplied at the equilibrium price. supply=demand ayos?
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.
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.
How are resources allocated under a capitalistic economy?
By the market mechanism...where they will be used most efficiently by those who can pay the price at equilibrium
What happens to the equilibrium price and equilibrium quantity in a market if the demand curve shifts to the right?
If the demand shift to the right, the equilibrium price and quantity will shift from the initial equilibrium price and quantity to the next, i mean the equilibrium price and quantity will increase as compare to the first.
What is consumer equilibrium?
consumer equilibrium states that consumer maximise his utility with the given income and with the given price or when a consumer getting maximum satisfaction with available resources then he will be in a state of equilibrium.
Where is the price ceiling located on a graph depicting market equilibrium?
The price ceiling is located below the equilibrium price on a graph depicting market equilibrium.
What is meant by an efficient market equilibrium?
When there is allocative and productive efficiency, there is an efficient market equilibrium, allocative efficiency is when the products that are most wanted are produced, this is achieved when price equals marginal cost, productive efficiency is achieved when the firm is producing on the lowest point on the lowest average cost curve, this is also called the point of technical efficiency, both allocative and productive efficiency lead to an optimum allocation of resources and economic efficiency is achieved, though, this is thought to exist only in a perfectly competitive market and is lacking in other markets because monopolies and oligopolies usually have their prices above marginal cost and that is not an efficient allocation of resources and because other markets may lack the incentive to produce at the lowest cost
How does producer surplus change as the equilibrium price of a good rises or falls?
Producer surplus increases as the equilibrium price of a good rises, and decreases as the equilibrium price falls.
