Business studies - Price, demand & supply

The Equilibrium in products

The Equilibrium is the point of which both customers (Consumers) and Firms (Producers) agree on a "Compromise" of price for product, this is done if the product is too expensive then people will not buy it, however if it is too cheap producers are missing out on profit. This after a while will even out at a price which the Producer and consumer are both rather happy to pay for the product.

Market-led Pricing

A firm will use Market-led pricing if the prices of products have a large effect on…