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It was found experimentally that Market has to re-establish Equilibrium via Market mechanism. Such that Market equilibrium is a desired status in the market where both suppliers and Consumers will tend re-establish market equilibrium (through demand & Supply) undeliberately.
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Why does the time it takes to reach equilibrium vary from market to market?
It takes time to reach the equilibrium because they don't know what is the "right price" to sell the product. whether prices change quickly or slowly however once they move toward equilibrium shortages and surpluses start to disappear.
What will cause a change in equilibrium price?
The equilibrium once disturbed by a price change, reacts based on which direction the price was changed. Higher prices reduce demand and increase supply, while lower prices increase demand and lower supply.
What is a naturally correcting market?
A nationally correcting market is a market that corrects itself, such as the real estate market or the job market. In the past, once an upcoming presidential election is about to occur, the job market goes down. Once the President is elected and has been in office for awhile (hard to determine how long, the job market eventually climbs back up). In other words, jobs will be available.
Why the market is unstable at consumer equilibrium?
There are many reasons why a consumer market equilibrium may be unstable, and it depends on which school of economic thought you follow. Generally, if there actually is a consumer equilibrium (which some believe does not truly occur) then what will cause it to become unstable is the effect of random shocks: I.e.) let future consumption for any period be ct+j = ct + Et. E is a random shock variable which is normally distributed around the mean (which we'll assume to be 0). Consumption in any period is simply equal to consumption in the period of time = t plus whatever shocks occurs in the economy (i.e.) political unrest, social movements, oil crises, etc.). In an economy, small shifts in variables such as consumption can cause larger changes because once an economy moves away from equilibrium, it causes a resulting change in other key equations which is no longer optimal. How the economy restores to equilibrium is also a debate amongst economist: Keynesians believe that wages/prices are 'sticky' and thus equilibrium is slow to reoccur after a shock; classicists believe that wages/prices are not sticky so that equilibrium will reestablish itself quickly. The rate at which an economy corrects these shocks will also affect how unstable equilibrium is. Finally, equilibrium can also constantly change due to factors such as technological growth. The economy needs time and information to adjust to these new equilibria and this can cause instability.
What is the perfectly competitive equilibrium price and quantity?
In a real life, one can never achieve perfect equilibrium of price and quantity. Those are relative terms and can be better understood on paper. Equilibrium of price and quantity is primarily driven by demand. In short, the more demand is accompanied by increased supply. Once the increased supply outstrips the demand, the prices come down to meet the lower demand. When the prices are low, people will want to buy more, which increases the demand of a commodity. This is a never ending cycle and thus a perfect equilibrium of price and quantity is not achieved. A perfect equilibrium means the supply is in a perfect balance with demand resulting into stable prices. A manufacturer can never produce 963 products to meet the exact demand of 963 products. To find it, it is where Price=Marginal cost
Why does the time it takes to reach equilibrium vary from market to market?
It takes time to reach the equilibrium because they don't know what is the "right price" to sell the product. whether prices change quickly or slowly however once they move toward equilibrium shortages and surpluses start to disappear.
What will cause a change in equilibrium price?
The equilibrium once disturbed by a price change, reacts based on which direction the price was changed. Higher prices reduce demand and increase supply, while lower prices increase demand and lower supply.
How does a system respond to change once it has reached equilibrium?
At equilibrium its not changing (any more).
Do random movements of molecules stop once equilibrium is reached?
Yes. Equilibrium is when the movement of molecules stops and equals out.
How long does it take for ants to make a line once disturbed?
about 5 seconds
What is Dynamic equilibrium?
In a dynamic equilibrium, the rate of loss is equal to the rate of gain. Dynamic equilibrium is applied in thermodynamics for systems involving reversible reactions.
Do hyacinth only bloom once?
Hyacinth bloom once a year. Then as long as the bulb is not disturbed, it will bloom again the following spring.
Can living things reach equilibrium?
Essentially by the continuous transfer of molecules in and out of the cell - glucose is a good example of a molecule the cell continually needs to take in.
If a reaction is at equilibrium and you add reactants what happens?
If you continuously add reactants even after the reaction has attained the equilibrium then according to Le Chatelier's principle, the reaction will again proceed in forward direction in order to neutralise the reactants and once again the attain the state of equilibrium.
What can eye do to feel happy after feeling distrubed?
To feel happy after feeling disturbed it is probably best to deal with whatever was making you feel disturbed in the first place. Once the problem is resolved you will likely get back to feeling happy again.
How do chemical manufacturers make the reaction continue to make ammonia once the reaction has reached equilibrium?
By Le Chetalier's principle - remove product. This encourages the reaction to produce more product to balance the equilibrium.
What are the characteristic of a reaction that establishes equilibrium state once?
The concentration of reactants and products remain constant.
