Purchase Solution

Markets in Equilibrium

Not what you're looking for?

Ask Custom Question

For markets to be in equilibrium (that is, for there to be no strong pressure for prices to depart from their current levels),
a. The expected rate of return must be equal to the required rate of return; that is, .
b. The past realized rate of return must be equal to the expected rate of return; that is, .
c. The required rate of return must equal the realized rate of return; that is, .
d. All three of the above statements must hold for equilibrium to exist; that is, .
e. None of the above statements is correct.

Purchase this Solution
Solution Summary

This solution is comprised of a detailed explanation to answer markets to be in equilibrium.

Solution Preview

For markets to be in equilibrium (that is, for there to be no strong pressure for prices to depart from their current levels),
a. The ...

Purchase this Solution
Free BrainMass Quizzes
Six Sigma for Process Improvement

A high level understanding of Six Sigma and what it is all about. This just gives you a glimpse of Six Sigma which entails more in-depth knowledge of processes and techniques.

Accounting: Statement of Cash flows

This quiz tests your knowledge of the components of the statements of cash flows and the methods used to determine cash flows.

Introduction to Finance

This quiz test introductory finance topics.

Learning Lean

This quiz will help you understand the basic concepts of Lean.

Transformational Leadership

This quiz covers the topic of transformational leadership. Specifically, this quiz covers the theories proposed by James MacGregor Burns and Bernard Bass. Students familiar with transformational leadership should easily be able to answer the questions detailed below.

View More Free Quizzes
Related BrainMass Solutions

  • The deadweight loss

    Both markets have an equilibrium price of 10 and quantity of 200. Therefore both markets are of the same size.

  • Classical economics and Keynesian economics

    Therefore, to avoid a situation like this the government should intervene in the markets and ensure that markets remain close to the full market equilibrium.

  • Surplus Ideas: Consumer surplus, Producer surplus

    Overproduction (Above the equilibrium levels) subtracts from the surplus because society values the use of the additional resources in other pursuits more than it values them in consumption of that good.

  • General equilibrium theory

    General equilibrium models typically involve a multitude of different goods markets. In a market system, the prices and production of all goods, including the price of money and interest, are interrelated.

  • firms in compeitive markets

    p = MC = 2q Revenue = (2q) X q - 100 - q^2 = 0 this gives us q = 10 hence p = 2q = 20 The firms in competitive markets are examined. The competitive equilibrium price in the industry are given.

  • Demand, Supply, and Equilibrium Point

    565178 Demand, Supply, and Equilibrium Point Equilibration is the process of moving between two equilibrium points as a result of some change in supply or demand.

  • Market Equilibrium Process in Real Life

    Analyzed the relationship between efficient markets theory to market equilibrium (100%) Business: Economics: Market Equilibrium, High The paper is organized in a logical and coherent manner.

  • How anti-pollution policy (ethanol) affects markets.

    This causes the supply to shift to the left in these markets. The result is a higher equilibrium price and less output. The problem looks at the relationship between policy and the effect on seemingly unrelated markets.

  • Monopolies and minimum wages

    This is because W2 is the equilibrium wage to which non monopolistic markets will adjust without interference. The marginal cost curves and supply curves are identical in these markets.

View More Related Solutions