Equilibrium in Perfect Competition
Equilibrium in perfect competition is the point where market demands will be equal to market supply. A firm's price will be determined at this point. In the short run, equilibrium will be affected by demand. In the long run, both demand and supply of a product will affect the equilibrium in perfect competition. A firm will receive only normal profit in the long run at the equilibrium point.
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Famous quotes containing the words equilibrium, perfect and/or competition:
“They who feel cannot keep their minds in the equilibrium of a pair of scales: fear and hope have no equiponderant weights.”
—Horace Walpole (1717–1797)
“And then at last our bliss
Full and perfect is,
But now begins; for from this happy day
The old Dragon underground,
In straiter limits bound,
Not half so far casts his usurped sway,
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—John Milton (1608–1674)
“Like many businessmen of genius he learned that free competition was wasteful, monopoly efficient. And so he simply set about achieving that efficient monopoly.”
—Mario Puzo (b. 1920)