ECON 1001 Lecture Notes - Lecture 11: Economic Equilibrium, Equilibrium Point, Excess Supply
Document Summary
It is a situation of zero excess demand and zero supply. That is a situation of equality between quantity demanded and quantity supplied. The price prevailing at the equilibrium point is the equilibrium price. The quantity prevailing at the equilibrium point is the equilibrium quantity. It is determined by the 2 forces demand and supply. Shorter the time period more would be the role of demand in determination of price. There would be excess supply in the market. There would be excess demand in the market. Determination of market equilibrium with the help of a demand and supply schedules and diagram. Market equilibrium is determined by the two opposite forces in the market namely demand and supply. Although producers and consumers have opposite interests buying and selling takes place only at a price which is acceptable to both the parties.
