Th1.2: Price Determination Flashcards
1
Q
What does the equilibrium point refer to?
A
the point at which there are no more forces bringing about change
2
Q
What is price equilbrium?
A
where supply is equal to demand - where the supply and demand curves cross
3
Q
What is price equilibrium also known as?
A
market clearing
4
Q
Refer to PP
See Graph 11. Where is the market clearing price?
A
P1 with a quantity Q1
