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Author Question: Why is the equilibrium price the best deal available for both buyers and sellers? What will be an ... (Read 63 times)

lb_gilbert

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on: Jun 29, 2018
Why is the equilibrium price the best deal available for both buyers and sellers?
 
  What will be an ideal response?

Question 2

The quantity of goods and services that can be produced by one worker or by one hour of work is referred to as
 
  A) human capital. B) labor productivity. C) technology. D) real GDP.


dawsa925

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Reply #1 on: Jun 29, 2018
Answer to Question 1

The equilibrium price reflects that the highest price consumers are willing to pay for that amount of the good or service and is just equal to the minimum price that suppliers require for delivering it. Demanders would prefer to pay a lower price, but suppliers are unwilling to supply that quantity at a lower price. Suppliers would prefer a higher price, but demanders are unwilling to pay a higher price for that quantity. Hence neither demanders not suppliers can do business at a better price.

Answer to Question 2

B


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