When markets fail to clear and achieve their final equilibrium point, they are said to be in disequilibrium. Disequilibrium might develop if the price was lower than the market equilibrium price, causing demand to exceed supply, resulting in a shortage. Government regulations, non-profit maximization actions, and 'sticky' prices can all cause disequilibrium. The demand (Q1) is greater than the supply (P1) at a price of P1 (Q3). As consumers try to get the limited supply, this disequilibrium will result in a shortage (Q1-Q3) and long lines. In a free market, you'd expect businesses to deal with this imbalance by raising prices to ration demand.
Causes of disequilibrium
- Sticky prices: Firms may be committed to maintaining the same price for the entire year. As a result, if demand rises over the season, there will be a shortage because the company does not want to continuously changing pricing — especially when demand is erratic. There are menu costs in adjusting pricing, but they can also upset customers by raising prices constantly.
- Social factors: Firms may intentionally keep prices low because they believe they have an obligation to the community - for example, landlords not raising rent, or football teams not raising ticket costs.
- Non-profit maximizing decisions: Individuals are assumed to be rational and endeavor to maximize utility in economics. Other forces, though, are at play in the real world. Ub3r, for example, uses 'surge pricing,' which allows the price to climb in response to high demand, encouraging more drivers to work. However, this might mean that in the event of a natural disaster, Uber appears to be profiting from 'unfairly high' costs. Uber's algorithms have been adjusted to override these equilibrium prices.
- Government controls: ex maximum or minimum prices or government regulating prices, ex train tickets limited by rail regulators.
<h2>
Price above equilibrium</h2>
In other circumstances, the price may be set higher than the equilibrium price, resulting in a surplus of supply. At P2, supply exceeds demand, implying that businesses have surplus inventory they can't sell. There is a Q3-Q2 surplus. In a free market, the market price should fall to P1, where demand equals supply.
Answer:
slave trade and deerskin trade
Explanation:
The Carolina Colony was founded in the first half of the 17th century, and since 1670 circa, they based their economy on trades made with the countries of Europe.
The Carolinas offered to the Europeans Indian-Native American slaves and also animal skin. The Europeans, on the other hand offered back <em>alcohol, munition and weapons</em>.
The Carolinas were a major exporter of enslaved Native Americans to Europe.
E) personality
These characteristics about Lugo indicate her personality.
~ Good luck!
Answer:
Water transportation plays a significant role in the economy of Georgia.
Explanation:
According to the text, deepwater ports supported over 350,000 jobs in Georgia in 2015. Deepwater ports are one form of water transportation in Georgia, which means water transportation plays a significant role in Georgia's economy.
