ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The market price of an asset or service is determined by the forces of supply and demand. The price at which quantity supplied equals quantity demanded is the market price. The market price is used to calculate consumer and economic surplus.

Detailed explanation-2: -Price is dependent on the interaction between demand and supply components of a market. Demand and supply represent the willingness of consumers and producers to engage in buying and selling. An exchange of a product takes place when buyers and sellers can agree upon a price.

Detailed explanation-3: -Market forces determine the price and quantity of a good or service in a market. Market forces occur naturally in a free market economy and are controlled by government intervention. An example of market force acting is when the price of crude oil increases when there are shortages in the supply.

Detailed explanation-4: -A market economy is one in which the allocation of resources and the prices of goods and services are determined by market forces, primarily supply and demand.

Detailed explanation-5: -A market economy is an economic system in which individuals, rather than the state, own most of the resources. This includes land, labor, and capital. In a market economy, individuals control the use and price of these resources through voluntary decisions made in the marketplace.