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Prevailing Price

Author: Kate Eskra

Source: Image of Demand Graph created by Kate Eskra, Image of Supply Graph created by Kate Eskra, Image of Equilibrium Graph created by Kate Eskra

Video Transcript
Terms to Know
Equilibrium

The price and quantity pair at which supply and demand intersect; price and quantity at which the market clears.

Law of Demand

The inverse correlation between price and quantity with all other variables fixed.

Law of Supply

If the price of a good decreases, the quantity supplied decreases.