GENERAL KNOWLEDGE

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: -Demand is generally considered to slope downward: at higher prices, consumers buy less. The point at which the two curves intersect represents the market-clearing price-the price at which demand and supply are the same.

Detailed explanation-3: -Equilibrium is the point where demand for a product equals the quantity supplied. This means that there’s no surplus and no shortage of goods.

Detailed explanation-4: -The law of supply and demand combines two fundamental economic principles describing how changes in the price of a resource, commodity, or product affect its supply and demand. As the price increases, supply rises while demand declines. Conversely, as the price drops supply constricts while demand grows.

Detailed explanation-5: -The price of a commodity is determined by the interaction of supply and demand in a market. The resulting price is referred to as the equilibrium price and represents an agreement between producers and consumers of the good.