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Price Determination in Perfect Competition by sridharvchinni_21769 is a document available to read on EtoBox.
What is Price Determination in Perfect Competition about?
1. Under perfect competition, the equilibrium price is where market demand equals market supply. 2. If demand exceeds supply at a given price, there is excess demand, which causes the price to rise until supply and demand are equal. Conversely, if supply exceeds demand, there is excess supply, which causes the price to fall until equilibrium is reached. 3. The equilibrium price of ice cream in the example is Rs. 3, where market demand of 30 dozens equals market supply of 30 dozens.
- Author
- sridharvchinni_21769
- Language
- EN