Explain the effect of time element on equilibrium price with diagram.
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Explanation:
Evidently as demand increases, the market price rises correspondingly and when demand decreases, the price also decreases to that extent. The point is clarified in figure (B). A shift in the demand curve from DD to D1D1 means an increase in demand, along with it the new equilibrium price rises from OP to OP1.
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Answer:
Evidently as demand increases, the market price rises correspondingly and when demand decreases, the price also decreases to that extent. The point is clarified in figure (B). A shift in the demand curve from DD to D1D1 means an increase in demand, along with it the new equilibrium price rises from OP to OP1.
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