The assumption of continuous market clearing means that:
A) sellers can sell all that they want at the going price.
B) buyers can buy all that they want at the going price.
C) in any given month, buyers can buy all that they want and sellers can sell all that they want at the going price.
D) at any given instant, buyers can buy all that they want and sellers can sell all that they want at the going price.

Question

Quizplus · Accepted Answer

The assumption of continuous market clearing assumes that at any given instant buyers can buy all that they want and sellers can sell all that they want at the going price. This assumption is based on the idea that markets are constantly in a state of equilibrium, with supply and demand always balanced, and that prices adjust instantaneously to clear any imbalances. This assumption is often used in economic models and theories, but may not always hold in the real world, where there may be frictions, such as transaction costs or information asymmetries, that can prevent markets from fully clearing.

The Assumption of Continuous Market Clearing Means That