RISK, RETURN & PROFITS

At O P Price, demand of the buyers is OL, while sellor are ready to sell ok quantity. (OK>OL) i.e. There is excess supply. In this situation there will be a competition among the sellers. On the contrary at 0T prices demand will be ON units where as supply will be OM units. In this case demand will be more than supply & prices will tent to increase.

At Point ‘E’ there will be equilibrium of Demand supply. This will be equilibrium price.