equilibrium analysis] for one good (partial equilibrium analysis ←→ general equilibrium analysis )
- As quantity increases, the utility of the consumer decreases: law of diminishing marginal utility.
- The supplier’s cost (creation cost) rises as the quantity increases: law of increasing marginal cost. - The law of increasing marginal cost does not fit the reality.
- sublation (philosophy)
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Supply is constant in the short term
- Demand is the primary factor in price determination: marginal utility theory.
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In the long run, the producers can change the amount of supply.
- Price is determined by the producer’s convenience: work-value theory.
- It’s not just a matter of convenience on the part of the producers, though.
- Price is determined by the producer’s convenience: work-value theory.
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Walras Stability : Reaching a stable equilibrium solution through price fluctuations
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In response, Marshall. points out - Marshallian stability : A stable equilibrium solution is reached by fluctuations in quantity.
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Marshalls to stop
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