Economics · General Equilibrium Theory
Consider the following statements: (i) Walrasian stability is based on the assumption that buyers tend to raise their bid price if excess demand is positive. (ii) Marshallian stability states that producers will raise output when excess demand price is positive. (iii) Walrasian stability is based on the assumption that sellers tend to raise their price if excess demand is negative. (iv) Walrasian stability is based on the assumption that buyers tend to lower their bid if excess demand is positive. Choose the correct alternative:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Both (ii) and (iii) are true
- 2Only (ii) is true
- 3Both (i) and (iv) are true
- 4Both (i) and (ii) are true✓
Correct answer
Both (i) and (ii) are true
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