In a perfectly competitive market, forces of demand and supply determine the equilibrium price and quantity. Let's take a look at the mechanics: Supply and Demand Dynamics Demand: Consumers would want a good at different prices; as the price continues to decline, their purchasing power increases. Supply: The suppliers would supply a good based on the price they can get. If the pric... https://finxl.in/courses/financial-modelling-and-valuation-course.html