Why Do We Aspire to Achieve the Equilibrium for a Market

question 121

Essay

Why do we aspire to achieve the equilibrium for a market? What happens when supply and demand are not equal? Give two examples of events that could cause the equilibrium of a market to shift.

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Definitions:

Systems Theory

An interdisciplinary theory about the nature of complex systems in nature, society, and science, suggesting that entities are interconnected, influencing one another within a whole.

Complex Behaviors

Complex behaviors involve multiple steps, coordination, and higher cognitive functions such as decision-making and problem-solving, distinguishing them from simple or reflexive actions.

Multiple Factors

Refers to the presence of more than one contributing variable or element that influences an outcome or situation.

Social Learning Theory

A theory that suggests individuals learn from their environment through observation, imitation, and modeling, highlighting the importance of cognitive processes in learning from the social context.