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Q: When is the assumption of market clearing appropriate?
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How do market-clearing prices act as signals to buyers and sellers?

Most economists see the assumption of continuous market clearing as not very realistic. However, many see the assumption of flexible prices as useful in long-run analysis, since prices are not stuck forever


What is market clearing price?

Market clearing price is the price at which the quantity demanded of a product equals the quantity supplied.


What is a market clearing price?

A market clearing price is the price at which demand equals supply, so that the market "clears" (i.e., all of the goods supplied find a buyer).


Market clearing price?

The price that exists when a market is clear of shortage and surplus, or is in equilibrium.


What istha location on a map where supply and demand intersect called?

market equilibrium / market clearing price.


Which of the following is another term for market clearing price?

equilibrium price


The market clearing price is most closely associated with?

the equilibrium price


What is the market clearing price most closely associated with?

the equilibrium price


Why does this situation seldom happen in market economie?

Competition eliminates shortages and surpluses by setting a market- clearing price.


Factors that influence market structure?

state assumption of perfect competition


What is a market-clearing model?

The market clearing model is a model where prices adjust to equilibrating demand and supply meaning the quantity supply equals the quantity demanded. These models are useful for studying situations where prices are flexible.


The equilibrium price is also called market clearing price. True or False?

True