BSNS108 Lecture : BSNS 108 Topic 12 - Personal Debt, Capital Structure/Debt and dividends notes
20 Jan 2017
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At a high price there is a surplus. At a low price there is a shortage. How a supply-demand market adjusts to excess demand. There will be pressure from both sides of the market to increase price! These buyers will quickly begin to offer to pay a higher price. Example: if we begin at a price of then buyers want 560 cars but 360 buyers cannot get the good at all. rather than not get the good at all (and 100 would not). At price of buyers want to buy only 300 but sellers wish to sell 600. Therefore there is a surplus in the market. A more formal way of defining surplus would be to say that the the the quantity demanded which quantity supplied exceeds economist refers to as a situation of excess supply. At price of buyers want to buy 560 but sellers wish to sell only 200.
