ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Answer and Explanation: When supply and demand are balanced in a market, the situation is called market equilibrium.

Detailed explanation-2: -The tendency to move toward the equilibrium price is known as the market mechanism, and the resulting balance between supply and demand is called a market equilibrium.

Detailed explanation-3: -An equilibrium price is a balance of demand and supply factors. There is a tendency for prices to return to this equilibrium unless some characteristics of demand or supply change. Changes in the equilibrium price occur when either demand or supply, or both, shift or move.

Detailed explanation-4: -The point of equilibrium represents a theoretical state of rest where all economic transactions that “should” occur, given the initial state of all relevant economic variables, have taken place.

Detailed explanation-5: -General equilibrium requires time, training and specific inputs. Partial equilibrium is a market access analysis tool that can be used to anticipate some of the likely economic effects of various policy alternatives. It considers the effects of a given policy action in the market(s) that are directly affected.