Why Do Economists Emphasize the Importance of Equilibrium in Markets

question 183

Multiple Choice

Why do economists emphasize the importance of equilibrium in markets?
 

• A) because trading in markets can only occur at the equilibrium price and quantity 
• B) because the behaviour of buyers and sellers will automatically guide the market toward the equilibrium price and quantity 
• C) because all buyers and sellers are better off at the equilibrium point than any other price and quantity combination 
• D) because it represents a compromise between sellers hoping for low prices and buyers searching for high prices

Understand the arguments for and against the relevance of leadership in organizational outcomes.

Understand the promotional objectives at different stages of the product life cycle.

Identify the key promotional elements significant to various stakeholders.

Recognize the importance of personal selling in the business buying process.

---

Definitions:

Processing Department

A section within a manufacturing facility where specific types of operations or treatments are carried out on products.

First-In, First-Out Method

An inventory valuation method where the first items purchased or produced are the first ones sold, affecting the cost of goods sold and ending inventory value.

Equivalent Units

A concept used in process costing that converts partially completed units into a smaller number of fully equivalent completed units.

Conversion Costs

represent the total expenses incurred to convert raw materials into finished products, which typically include labor and overhead costs.