The equilibrium price is the only price where the desires of consumers and the desires of producers agree—that is, where the amount of the product that consumers want to buy (quantity demanded) is equal to the amount producers want to sell (quantity supplied).
When two lines on a diagram cross, this intersection usually means something. On a graph, the point where the supply curve (S) and the demand curve (D) intersect is the equilibrium.
What Is a Demand Schedule? In economics, a demand schedule is a table that shows the quantity demanded of a good or service at different price levels. A demand schedule can be graphed as a continuous demand curve on a chart where the Y-axis represents price and the X-axis represents quantity.
An example from the market for gasoline can be shown in the form of a table or a graph. A table that shows the quantity demanded at each price, such as Table 1, is called a demand schedule.
Price (per gallon) Quantity Demanded (millions of gallons) $1.00 800 $1.20 700 $1.40 600 $1.60 550 $1.80 500 $2.00 460 $2.20 420 Table 1. Price and Quantity Demanded of Gasoline
Supply schedule
again using the market for gasoline as an example. Like demand, supply can be illustrated using a table or a graph. A supply schedule is a table, like Table 2, that shows the quantity supplied at a range of different prices. Again, price is measured in dollars per gallon of gasoline and quantity supplied is measured in millions of gallons.
Price (per gallon) Quantity Supplied (millions of gallons) $1.00 500 $1.20 550 $1.40 600 $1.60 640 $1.80 680 $2.00 700 $2.20 720 Table 2. Price and Supply of Gasoline
Because the graphs for demand and supply curves both have price on the vertical axis and quantity on the horizontal axis, the demand curve and supply curve for a particular good or service can appear on the same graph. Together, demand and supply determine the price and the quantity that will be bought and sold in a market.
The equilibrium price is the only price where the plans of consumers and the plans of producers agree—that is, where the amount of the product consumers want to buy (quantity demanded) is equal to the amount producers want to sell (quantity supplied). This common quantity is called the equilibrium quantity. At any other price, the quantity demanded does not equal the quantity supplied, so the market is not in equilibrium at that price. In Figure 3, the equilibrium price is $1.40 per gallon of gasoline and the equilibrium quantity is 600 million gallons. If you had only the demand and supply schedules, and not the graph, you could find the equilibrium by looking for the price level on the tables where the quantity demanded and the quantity supplied are equal. The word “equilibrium” means “balance.” If a market is at its equilibrium price and quantity, then it has no reason to move away from that point. However, if a market is not at equilibrium, then economic pressures arise to move the market toward the equilibrium price and the equilibrium quantity. Imagine, for example, that the price of a gallon of gasoline was above the equilibrium price—that is, instead of $1.40 per gallon, the price is $1.80 per gallon. This above-equilibrium price is illustrated by the dashed horizontal line at the price of $1.80 in Figure 3. At this higher price, the quantity demanded drops from 600 to 500. This decline in quantity reflects how consumers react to the higher price by finding ways to use less gasoline. Moreover, at this higher price of $1.80, the quantity of gasoline supplied rises from the 600 to 680, as the higher price makes it more profitable for gasoline producers to expand their output. Now, consider how quantity demanded and quantity supplied are related at this above-equilibrium price. Quantity demanded has fallen to 500 gallons, while quantity supplied has risen to 680 gallons. In fact, at any above-equilibrium price, the quantity supplied exceeds the quantity demanded.
In the case when the rate of the interest decrease so the market value of the bond would be increased. As the market value of the bond and the rate of interest has an inverse relationship between them. In the case when the rate of interest increased than the market value of the bond decreased and vice versa
the interest rate is missing, so I looked for similar questions and found that the semiannual interest rate is 3%.
first of all, we must determine the amount of money that we need to have in our account in order to be able to withdraw $25,000 in 10 years.
You will start making your semiannual deposits today and they will end in exactly 2 years, so we need to find out the present value of the $25,000 in two years:
PV = $25,000 / (1 + 3%)¹⁶ = $15,579.17
that is now the future value of our annuity due:
FV = semiannual deposit x FV annuity due factor (3%, 5 periods)
The four-firm ratio is the concentration ratio between the total sales accumulated by the four largest industrial firms to the total sales of all firms present in an industry. This translates to the mathematical expression of
four-firm ratio = (total sales of four largest firms / total sales)
Since, we are given that all 10 firms have the same sales, we let the sales be equal to x.
total sales of four largest firms = 4x total sales = 10x
The ratio is then,
four-firm ratio = 4/10
Converting this to percentage will yield us an answer of 40%.