Supply, Demand and prices

Chapter three is based on the topic of ‘Supply, Demand and prices’. This is started off by a clear look at the previous topic’s work where the reader had already been familiarized with the demand-supply curves. This then forms the basis of the introduction for the whole topic as the reader is analytically taken through the processes that cause shifts along the supply and demand curves. This then leads the reader to the first portion of the topic which is ‘Stocks versus Flows’. At this point, both supply into the market and demand of goods out of the market are taken as ‘flows’ and not as fixed amount of stocks (Ashby, 68). ‘Market Equilibrium’ then comes in as the next section. The book discusses its meaning with clearly drawn diagrams that enhance the understanding of a point of equilibrium as a point in the market where the quantity of goods supplied equals the quantity of goods demanded. ‘Determining the equilibrium price’ is the next section in the topic. At this point, the reader is explained to how the market regulates prices so that they remain at the equilibrium point in most of the occasions. Producers are the ones who drive the market price to the equilibrium level either as a result of panic or even greed and this happens as a result of the feedback that the market offers to the producers (Ashby, 78). Problems in the public sector then come in as the reader is expounded on the problems that come with fixed production and supply of government-controlled products.

…………………………………………………………………………………….

Place an order with us to get a customized paper similar to this or any related topic. NB: The assignment will be done from scratch and it
will be 100% original.

Posted in Uncategorized

Leave a Reply