Equilibrium Analysis

Equilibrium Analysis - Equilibrium Analysis ,...

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Equilibrium Analysis In the market for any particular good  X , the decisions of buyers  interact simultaneously  with the  decisions of sellers. When the demand for good  X  equals the supply of good  X , the market for good  X  is said to be in  equilibrium . Associated with any market equilibrium will be an  equilibrium  quantity  and an  equilibrium price . The equilibrium quantity of good  X  is that quantity for which the  quantity demanded of good  X  exactly equals the quantity supplied of good  X . The equilibrium price  for good  X  is that price per unit of good  X  that allows the market to “clear”; that is, the price for which  the quantity demanded of good  X  exactly equals the quantity supplied of good  X . The determination  of equilibrium quantity and price, known as  equilibrium analysis , can be achieved in two different 
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