Price determination 20 feb

In Excess demand

Competition between

• Buyers

• Sellers

In Excess supply

Competition between

• Buyers

• Sellers

In Excess demand

Prices

• Decrease

• Increase

Excess supply

Price

• Increases

• Decrease

When increase in demand=increase in supply

Price

• Increase

• Decrease

• Constant

When demand is constant and supply increase then

Equilibrium price

• Increases

• Decrease

When supply constant and demand decrease

Equilibrium price will

• Increases

• Decrease

When increase in demand is more than increase in supply

Then there will

• Buyers compete

• Sellers compete

In when demand decrease

And supply increase

Equilibrium price will

• Decrease

• Increase

In perfect competition

Market equilibrium is determined when

• Demand more than supply

• Demand=supply