If the demand in a perfectly competitive market decreases,the price will:

Name: If the demand in a perfectly competitive market decreases,the price will:
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Question

Quizplus · Accepted Answer

In a perfectly competitive market, where there are many sellers and buyers, and the product is homogeneous, a decrease in demand will lead to excess supply. This will force the sellers to reduce the price of the product to clear the excess supply. Therefore, the price will temporarily decrease until equilibrium is reached again.

If the Demand in a Perfectly Competitive Market Decreases,the Price