Factors Influence the Equilibrium Price

1970 WordsNov 19, 20078 Pages
Bradford University School of Management FT MBA 2007/2008 Business Economics (MAN4101M) Assessed coursework I certify that this assignment is the result of my own work and does not exceed the word count noted below. Bradford, 19th November 2007 ______________________________________ Word Count (excluding tables, diagrams and reference): 1750 Market Equilibrium Introduction: Market is a place where buyers and sellers come together and a good is offered for sale by producers and purchased by consumer (Blake, 1993). The relation between the demand and supply determines the equilibrium position of a particular good or a service. In this essay we will take a look at the factors that influence the equilibrium position of a good in the…show more content…
In case of elastic supply rise in price level will be less from £10 to £13 but the rise in output will be very significant from 100 to 500. 4) Changes in supply when demand is elastic or inelastic When demand is elastic, the shift in supply brings small change to the price of the good but huge change to the output. If the demand is inelastic, shift in supply brings huge rise of price levels with small changes to output levels (Begg and Ward, 2007). In Fig.7 (Begg and Ward, 2007) prices drops to £20 pounds from £17 due to shift in supply curve but the output increases from 100 to 400 incase of elastic demand. For inelastic demand price drops to £10 from £20 due to shift in supply curve but the output level increases only to the level 200 from 100. Conclusion: From the above scenarios we can conclude that the changes in demand and supply for a good in the market lead to a change in the equilibrium position of the good. Carbon permits Introduction: Under the Kyoto Protocol, the European Union Emissions Trading scheme (EU ETS) was launched in 2005, which has committed itself to reduce carbon level emissions by 8% from 1990 levels between 2008 and 2012. The phase one of this scheme is coming to an end and the second phase will be from 2008 till 2012. In this view, this essay will discuss how the carbon market expanded in the last few years, the demand
Open Document