Understandin How Market Works in Practice

1491 Words6 Pages
The aim of this paper is for understanding how market works in practice, what is price mechanism and how does it work in market system. What is the role of demand, supply and equilibrium, what happens when price mechanism doesn’t work properly? I will try to explain conditions of the demand, supply and law of demand and supply. I will compare partial and general equilibrium which was Marshall and Walras theories. Market any goods, services, buyers and sellers of a thing in general trading point they come together is for. The simplest example is for the market is a Bazaar. However, depending on the developments in the market today, especially communication tools are also diversified. Conducted via telephone and internet e-commerce are the most obvious examples of new types of markets. Buyers and sellers cannot come face to face these markets share in world trade is increasing rapidly. According to the type of market is named of what they are trading. For example money market, labour market... For me, there was always been a problem in the market has been the question. This is question is what, how and for whom to produce. For this question there is a 3 different type of economy. Command economy, free market economy and mixed economy. Command economy, the majority of factor of production to be within state control, production and distribution decisions by the state is done from the economic system. It is the opposite of a free market economy. That state is the owner

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