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The competition balance is a condition in which demand and supply amount are matched.
It is a point where you want to buy and sell.
The price at this time is called the balance price.
Demand = SupplyIf the price is too high, the product will be too much and the price will be lowered.
If the price is too low, the product will not be enough, and the price will rise.
As a result of its adjustment, the market will be considered to be “just a good price”.
The competition balance is the basis for seeing a wide range of markets, such as super product price, hotel price, stock price, real estate, and exchange.
What is a competition balance?
The competition balance is a condition in which demand and supply are matched.
In economics, it represents:
Qd = Qs| Signs | 意味 |
|---|---|
| `Qd` | Demand, Quantity |
| `Qs` | Supply volume, sold amount |
If the amount you want to buy and the amount you want to sell is the same, the trade will be easier in the market.
The price at this time is the balance price.
In this price, people who want to buy and sell are not very frustrating, and the market is easy to calm.
What is the balance price?
衡librium price is the same price as the amount of demand and supply.
The two lines are crossed by the demand curve and supply curve.
The demand curve is the line of the right downward, which is easy to buy as the price goes down.
The supply curve is a line up to the right, which is easy to sell as the price rises.
When the two are crossed, the amount you want to buy and the amount you want to sell is matched.
There is a balance price.
However, the real market price is not always at the right balance price. News, Inventory, Big Data, Interest Rates, Regulations, Forex
However, the power to return will work.
If the price is too high
If the price is too high, the excess supply will occur.
Excessive supply is more than the amount you want to sell.
For example:
| 項目 | Quantity |
|---|---|
| Sell | 100 pcs |
| Buy | 50 pieces |
In this case, the product is too much.
When the resold, the seller considers the price reduction.
- Price reduction
- Sale
- Inventory disposal
- Coupon Distribution
- 生産
These movements make it easier to down.
Super closed pre-sale, seasonal goods inventory disposal, molded household appliances discount is close to this image.
If the price is too low
If the price is too low, excess demand will occur.
Excess demand is higher than the amount you want to buy.
For example:
| 項目 | Quantity |
|---|---|
| Buy | 100 pcs |
| Sell | 50 pieces |
In this case, the product is not enough.
When the product is thin, the seller becomes easier to raise the value.
- 値上げ
- Lottery sales
- Reservation
- Contact Us
- Resale price rise
Popular game consoles, new smartphones, live tickets, hotel rates during peak periods, etc. are examples that are likely to cause excess demand.
If there are many people who want it, but there is not enough supply, the price becomes easier.
Why the market is衡librating
In the market, the price changes when the participant is レd.
If it is too high, the buyer will decrease.
If the sales remain, the sales side will be lowered.
If you are too cheap, the number of people you want to buy is increasing.
If the product becomes thin, the seller will raise the value.
In this way, even if the price is too high or too cheap, the supply and demand threshold appears on the table.
I think that the market is easy to balance because the price is moving in the direction of eliminating the misalignment.
Of course, it may not be adjusted immediately.
Wages, rents, public rates, regulatory prices, medical expenses, etc. are not moving immediately by demand and supply.
However, the competition balance is a basic tool that considers "why the price falls down to that level".
Examples in daily life
Popular Game Machines
The most popular game console in the market is easy to supply.
There are many people who want it, and the number of products is small.
In this state, the rise of the lottery sales and resale price becomes easier.
After that, when the production is increased and the supply is caught up, the price becomes calm.
Super close before sale
The side dish before closing is easy to find a few people who buy while the supply remains.
The store will be lowered because it remains sold in this way.
By lowering the price, you can increase the number of people you want to buy and reduce inventory.
Hotel Rates
Hotel demand increases in consecutive holidays and event days.
The number of rooms can not be increased rapidly.
Therefore, the price becomes easier.
On the contrary, Weekdays and offensive periods will be lowered to fill the vacancy.
Competitive balance in investment markets
The stock price is also a balance of people who want to sell.
When the stock price rises, the person who wants to sell is exceeded.
When the stock price falls, it is the state that the person who wants to sell is exceeded.
Easy stock price
- 好決算
- Upward Fix
- More
- Shares
- Theme
- Inflow of foreign funds
Easy stock price
- Disappointment
- Back to Top
- Revenue
- Interest rate rise
- Revenue weight
- Industry-wide sales
It is important here that the stock price is not determined only by the performance.
Even if the performance is good, the stock price may not be higher if it is already too expected.
On the other hand, even if the business performance is not strong enough, it may rise if the sales is low and the purchase is concentrated.
This is the adjustment of supply and demand.
What is a fully competitive market?
Economics may think about a fully competitive market as an ideal market.
The full competition market has the following features:
- Many sellers
- Many buyers
- Almost the same product
- Information is shared
- Free entry and exit
- Only a specific company can not control the price
In such a market, we think that price is easy to determine by demand and supply.
However, the real market is not only full competition.
Brand strength, monopoly, regulation, patent, distribution network, information disparity
So, when you look at the reality, you can see where the market may be distorted while using the competition balance.
Easy to misunderstand for beginners
| misunderstanding | In fact |
|---|---|
| The price is determined only by the company | Also affects supply and demand throughout the market |
| Popular products are much higher | If the supply increases, it may fall |
| cheaper | If too low, it may cause thinness and quality reduction. |
| Stock price is determined only by business performance | Great expectations and supply |
| 衡librium price fixed | If demand and supply change, the balance will move |
衡librium is not the same as once determined.
If the demand is increased, the balance price becomes easier.
If the supply increases, the balance price becomes easier.
The market is always moving.
The competition balance is a condition in which demand and supply amount are matched.
The following points are:
- Competitive balance between demand and supply
- Price at that time
- If the price is too high, it is easy to exceed the supply
- If the price is too low, it is likely to be in excess demand
- Markets move prices while adjusting supply and demand thresholds
- Useful when looking at stock price, price, real estate, and currency
First of all, it is easy to understand if you look at the price.
"Do you want to buy and sell?
“Is it too high?
“Is it too cheap and lacking?”
With this point of view, economic news and investment can be seen a little three-dimensional.