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It is the price where the intentions of buyers and sellers match.

where the supply and demand curves intersect

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Q: How is the equilibrium price determined?
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Related questions

How equilibrium of price level and real GDP is determined?

The answer is AJ Sanders


How is the equilibrium price related to the equilibrium quantity and how can these values be determined?

Demand: 300x+1500 Supply: 20x-q+1200?


Process of price determination?

Price is determined at the point of equilibrium. Equilibrium is a point of balance. In other words, equilibrium is the point at which quantity demanded and quantity supplied is equal. That is, market equilibrium refers to a condition where a market price is established through competition such that the amount of goods or services sought by buyers is equal to the amount of goods or services produced by sellers. This price is called equilibrium price.


How does a price ceiling undermine the rationing function of market-determined prices?

A price ceiling will undermine the rationing function of market-determined prices by creating a shortage. This is a price which is below equilibrium which will lead to more demand that supply that will cause a shortage.


Which most accurately describes how the equilibrium price of a good or a service can be determined?

By finding where the supply curve and the demand curve intersect.


The price of peanut butter rises due to a blight on the peanut crop. peanut butter and jelly are complements. What happens to the equilibrium quantity and price of jelly?

(A)Equilibrium price falls, equilibrium quantity increases (B) Equilibrium price rises, equilibrium quantity falls (C) Equilibrium price falls, equilibrium quantity falls (D) Equilibrium price rises, equilibrium quantity rises


What is another term for marketing clearing price?

equilibrium price


What equilibrium price and equilibrium quantity?

equilibrium price and equilibrium quantity?: equilibrium price: When the price is above the equilibrium point there is a surplus of supply The market price at which the supply of an item equals the quantity demanded Price at which the quantity of goods producers wish to supply matches the quantity demanders want to purchase sa madaling salita supply=demand=price equilibrium quantity: Amount of goods or services sold at the equilibrium price The quantity demanded or supplied at the equilibrium price. supply=demand ayos?


What happens when the equilibrium price is lower than the market price?

When the market price is lower than the equilibrium price the price of the product will continue to rise. The price will rise until it equal the equilibrium price.


What happens when the market price is lower than the equilibrium price?

When the market price is lower than the equilibrium price the price of the product will continue to rise. The price will rise until it equal the equilibrium price.


What happens to the equilibrium price and equilibrium quantity in a market if the demand curve shifts to the right?

If the demand shift to the right, the equilibrium price and quantity will shift from the initial equilibrium price and quantity to the next, i mean the equilibrium price and quantity will increase as compare to the first.


Why price ceiling and price floor is binding?

A price ceiling is binding when it is below the equilibrium price. It is the legal maximum price, so the market wants to reach equilibrium (which is above that) but can't legally. If it were above the equilibrium price it would not be binding because the market would reach equilibrium and the ceiling would have no effect. A price floor is binding when it is above the equilibrium price. You can use similar reasoning to that above. It is the legal minimum price. the market wants to reach equilibrium below that but can't legally.