--%>
Assignment Help - homework help

Demand often exceeds supply and supply exceeds demand

“In the corn market, demand often exceeds supply and supply sometimes exceeds demand.” “The price of corn rises and falls in response to changes in supply and demand.” Among these 2 statements used correctly which in the terms “supply” and “demand”?  Explain.

E

Expert

Verified

In the first statement “supply” and “demand” are used incorrectly. Supply and demand are both schedules and curves that intersect where quantity supplied and quantity demanded are equal.  One cannot talk of curves that intersect as exceeding or not exceeding each other.

Supply and/or demand can change (the entire curves can shift). Each time this happens, it will create a new intersection of the two curves that will lead to changes in the equilibrium quantity and price of corn.  Thus, the terms “supply” and “demand” are used correctly in the second statement.

   Related Questions in Business Economics

  • Q : Discuss the economic aspects of ticket

    Discuss the economic aspects of ticket scalping also identifying the gainers and losers?

    		•
  • Q : The supply curve when each of these

    What happens to the supply curve when each of these determinants changes?

    		•
  • Q : Who define Theory of Moral Sentiments

    The argument which slicing off one’s pinkie would be extra bothersome to which person than the loss of millions of his brethren was made within A Theory of Moral Sentiments (1755) through: (1) Adam Smith. (2) David Ricardo. (3) Theophrastus Phil

    		•
  • Q : Describe the equation of a linear

    Describe the equation of a linear relationship?

    		•
  • Q : Cost of debt and Equity Cost of debt =

    Cost of debt= (1-tax rate)* interest rate * (debt ÷capital employed)Cost of equity = risk free rate + market premium (equity shareholders funds÷ capital employed)

    		•
  • Q : Describe double coincidence of wants

    Double coincidence of wants: This means that one person's wishing to buy and sell should coincide with another person’s wish to buy and sell.

    		•
  • Q : Drawbacks of capital budgeting Write

    Write down the drawbacks of capital budgeting?

    		•
  • Q : Negatively association to probability

    Adam Smith would have agreed mostly along with the concept which wages are: (i) positively associated to physical comfort when working. (ii) negatively related to the cost of learning the business. (iii) positively associated to the s

    		•
  • Q : Market Apparent program For the

    For the question below, utilize the given information. The market for gizmos is competitive, with an increasing sloping supply curve and a downward sloping demand curve. With no govt. intervention, the equilibrium price is $25 and the equilibrium quantity is 10,000 gi

    		•
  • Q : Strategic behaviour of decisionmaker If

    If one decisionmaker in interdependent circumstances calibrates its decisions to the anticipated reactions of the other party, in that case the decisionmaker is engaged within: (1) psychological forecasting. (2) profit maximization. (3) collusion. (4) strategic behavi

    		•