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Defining market equilibrium

a. What is market equilibrium? Does the market always reach equilibrium? Discuss

b. If there is surplus of gasoline in the market, then the price of gasoline will rise. True or false. Explain.

Please provide examples for better understanding.

Solution Preview

a. What is market equilibrium? Does the market always reach equilibrium? Discuss

Market equilibrium represents a situation in the market wherein supply of an item is exactly equal to ...

Solution Summary

A definition of market equilibrium as well as a response of the market to a surplus in the gasoline market.

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