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When the price line is below the equilibrium point what will occur?
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A shortage will develop when?
The market price is below the equilibrium price.
When a surplus of a product will arise when price is above equilibrium or below equilibrium?
above equilibrium
What is a maximum price set below the equilibrium price?
Price Floor.
Process of price determination?
Price is determined at the point of equilibrium. Equilibrium is a point of balance. In other words, equilibrium is the point at which quantity demanded and quantity supplied is equal. That is, market equilibrium refers to a condition where a market price is established through competition such that the amount of goods or services sought by buyers is equal to the amount of goods or services produced by sellers. This price is called equilibrium price.
Where is the equilibrium price located?
At which point is the equlibrium price located
A shortage will develop when?
The market price is below the equilibrium price.
When a surplus of a product will arise when price is above equilibrium or below equilibrium?
above equilibrium
What is a maximum price set below the equilibrium price?
Price Floor.
Which point on the graph represents the equilibrium price?
Supply and demand graphs meet at the equilibrium price.
Process of price determination?
Price is determined at the point of equilibrium. Equilibrium is a point of balance. In other words, equilibrium is the point at which quantity demanded and quantity supplied is equal. That is, market equilibrium refers to a condition where a market price is established through competition such that the amount of goods or services sought by buyers is equal to the amount of goods or services produced by sellers. This price is called equilibrium price.
Where is the equilibrium price located?
At which point is the equlibrium price located
A price ceiling will only be binding if it is set?
below equilibrium price
What do you have when the actual price in a market is below the equilibrium price?
Excess Supply
Why price ceiling and price floor is binding?
A price ceiling is binding when it is below the equilibrium price. It is the legal maximum price, so the market wants to reach equilibrium (which is above that) but can't legally. If it were above the equilibrium price it would not be binding because the market would reach equilibrium and the ceiling would have no effect. A price floor is binding when it is above the equilibrium price. You can use similar reasoning to that above. It is the legal minimum price. the market wants to reach equilibrium below that but can't legally.
There will be a surplus of a product when?
price below the equilibrium level
When will there be a surplus of a product?
price below the equilibrium level
What happens if the current price is below the equilibrium?
He or She will be arrested.
