lecture 8 - market disequilibrium, rent seeking and price setting Flashcards
1
Q
what are shocks?
A
things that happen outside a market place, such as change sin prices results in endogenous changes in the market
2
Q
when is compeeteiv equilibrium reached?
A
when market clears
supply = mean demand
3
Q
when is the equilibrium price reached?
A
when the supply = demand
4
Q
what does equilibrium price reposed to?
A
exogenous shocks
5
Q
which way does the demand curve go?
A
downwards
6
Q
which way does the supply curve go?
A
upwards
7
Q
what is the point in which the demand and supply curve cross?
A
competitive equilibrium
8
Q
when there is shift in demand/supply what can some people do/
A
realise there are economic rents to be gained which can benefit from changing price
