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Competitive Market Price - Assignment

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Added on  2020-05-16

Competitive Market Price - Assignment

   Added on 2020-05-16

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Running Head: ECONOMICSEconomicsName of the StudentName of the UniversityAuthor note
Competitive Market Price - Assignment_1
1Table of ContentsAnswer 1..........................................................................................................................................2Answer 2..........................................................................................................................................4Answer 3..........................................................................................................................................4References........................................................................................................................................7
Competitive Market Price - Assignment_2
2Answer 1In the competitive market price and quantity is determined from the prevailing supplyand demand situation. Supply represents willingness of producer to supply a good at variousprices. Demand on the other hand measures the desire of buyers to buy the good supported bytheir purchasing power. The equilibrium in the market is obtained where supply and demandmatches (Arrow 2015). A nationwide shortage of butter is realized. There are both demand andsupply side factors causing the shortage.Figure 1: Decline in supply and supply shortage(Source: as created by Author)In figure 1, the demand curve in the butter market is DD and the supply curve is given asSS. E is the point of equilibrium. Price in the market is P1and corresponding quantity in themarket is Q1. One factor causing shortage in butter is increasing preference of the consumers
Competitive Market Price - Assignment_3

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