In competitive markets,the price of a given product is established through the forces of supply and demand.

Question

Quizplus · Accepted Answer

In a competitive market, the price of a product is determined by the interaction of market supply and demand. When there is an excess supply of a product, the price tends to fall, and when there is excess demand, the price tends to rise. This process helps to establish an equilibrium price at which the quantity supplied is equal to the quantity demanded, and there is no shortage or surplus of the product in the market.

In Competitive Markets,the Price of a Given Product Is Established