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)
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—Gore Vidal (b. 1925)
“Wearing overalls on weekdays, painting somebody else’s house to earn money? You’re working class. Wearing overalls at weekends, painting your own house to save money? You’re middle class.”
—Lawrence Sutton, British prizewinner in competition in Sunday Correspondent (London)