Price Formation (Grade 10 NSC Matric Economics): Flashcards
📚Flashcards
Practise the cards
10 cards from this deck
ShowHide
Practise the cards
10 cards from this deck
Price formation
Price formation
When supply & demand reach equilibrium point
Equilibrium point
Equilibrium point
Balance point where supply and demand meet
Two key info from equilibrium point
Two key info from equilibrium point
Equilibrium price & equilibrium quantity
When market reaches equilibrium
When market reaches equilibrium
When demand for product equals supply of product
Supply curve direction
Supply curve direction
Slopes upward
Demand curve direction
Demand curve direction
Slopes downward
Surplus
Surplus
More supply than demand (price above equilibrium)
Shortage
Shortage
More demand than supply (price below equilibrium)
Price mechanism
Price mechanism
System ensuring markets adjust to maintain balance
Markets' self-regulating nature
Markets' self-regulating nature
Naturally correct imbalances via automatic price adjustments