Companies operating in highly competitive industries offer products and services that are elastic as companies tend to charge prices.
When the price of a good or service reaches the elasticity point, sellers and buyers quickly adjust their demand for that good or service.
Elasticity is an important economic indicator, especially for sellers of goods or services, because it reflects how much of a good or service buyers will consume when the price increases or decreases.
Elastic goods or services are either not needed or can be easily replaced by a substitute.
“Best Effort” is a legal term that represents the obligation of a party to a contract to take all possible steps to fulfill the terms of the agreement.
Disequilibrium is when external forces cause an imbalance between supply and demand in the market. In response, the market enters a state in which supply and demand do not match.
Economic equilibrium is a state in which market forces are balanced, a concept borrowed from the physical sciences, where observable physical forces can balance each other.
An economist is an expert who studies the relationship between a society’s resources and its production or output, using a number of different indicators to predict future trends.
A trade-off between equity and efficiency arises when there is some conflict between maximizing net economic efficiency and achieving other social goals.
External economies of scale - these are factors that contribute to the development of business, which are manifested outside the company, but within the same industry.