Question
Classify the market on the basis of time and explain.
✓
Answer
On the basis of time market can be classified into following four types :
1. Very short period market: A very short period market is one during which supply of a commodity is fixed as it is already produced. This market is for a few days or maximum a week. So the price of the product is determined by demand. Eg. During festival time supply of fruits can be increased, so price rises.
2. Short period market : A short period market is said be a market upto one year. In this market supply of goods can be increased by increasing the variable factors like labour and raw material with the given fixed factors like machinery.
3. Long period market : A long period market is a market upto five years. In this J supply of a commodity can fully increased on demand as all factors of production can j be changed.
4. Very long period market : A very long period market is for more than five years. In this period there can be full adjustment of supply to demand.
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