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Essay / Market Balance - 1200
As with all markets and their respective economies, balance is one of the key factors in a successful system. Although most markets do not reach equilibrium, they try to get close to it. There are many methods designed to achieve balance, whether they involve direct human intervention or a cumulative decision of all factors involved. These factors could be a seller's desire to reduce overall revenue or a buyer's desire to hold back some demand for a given product. Of course, the fundamentals of supply and demand retrospectively control market equilibrium. Supply and demand is one of the simplest aspects of an economy and its study, yet it represents the greatest challenge for analysts. Although most events can be mathematically calculated to perfection, the human aspect always intervenes and disrupts the calculation. Dealing with the imperfections of psychology differentiates a modern analyst who shows initiative from one who follows an equation. With only supply, the factors involved in regulating supply also control some aspects of demand. Things like production costs and desired net profit can determine the success or failure of a business. Finding a balance between quantity and price is the best control a business can have. Pricing is obviously one of the most beneficial, if not destructive, elements of a business. Price is the first and most valuable thing an individual will look at, overriding most other judgments based on quality and details. However, balancing the price allows you to create an impeccable product, with just the right amount of detail that will drive the market, while generating a stable net income. paper......retrospective earnings of the company, making a price floor incapable of increasing earnings, which has been the goal all along. The most common, and now widely used, method is to provide a subsidy to both the buyer and the buyer. seller. The subsidy consists of reimbursing a customer for part of their payment to reassure the government in its actions, as well as to encourage them to buy more. Although this initially causes the low-cost seller to lose money, a percentage of the subsidy fund is returned to the seller to continue production. This gives the seller extra profit and brings customers back to them. The modern solar panel industry is an example of this, with the government taking on part of the investment. Customers don't pay as much upfront for solar panels, but their referrals and even repetitive use generate a higher profit for the seller..