Back to category: Business Limited version - please login or register to view the entire paper. Classical Economy Classical theory assumes the existence of a perfectly competitive market. Extensive competition between buyers and sellers creates an equilibrium market condition. With the economy in an equilibrium, the equilibrium price ensures quantities supplied equals quantities demanded. So, in the classical view, there can be no persisting shortages or surpluses. The equilibrium price and quantity can change only if the numerical value of one or more of the determinants of aggregate supply and or/aggregate d... Posted by: Asare Mabel Limited version - please login or register to view the entire paper. |
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