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July 14, 2024, 09:00:20 am

Author Topic: Equilibrium question help please  (Read 1044 times)  Share 

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Equilibrium question help please
« on: September 24, 2016, 09:36:28 am »
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Question:
Advances in technology have had both positive and negative impacts on Australian businesses. Explain how Australian retailers are affected by the increased use of online shopping. In your answer, make reference to the impact on the equilibrium price and quantity traded, and explain how the market returns to equilibrium.(4 marks)

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Re: Equilibrium question help please
« Reply #1 on: September 24, 2016, 09:52:48 am »
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Is it just because the increased use of online shopping has allowed retailers to appeal to a wider range of markets all over the world?
Thereby demand goes up and the increased quantity traded creates a shortage of goods and services at any given price level, raising the equilbrium price by market forces?
And overtime, the equilibrium price is restored because retailers are able to increase their production (perhaps after the initial long-starting implementation of technology), thereby clearing the shortage and returning the equilibrium back to normal levels?