Now consider the case in which the central bank wants to establish a bond price that is above the market equilibrium price; in fact, the central bank is then pursuing a minimum price policy for bonds.
The equilibrium price occurs at the intersection of the supply and demand curves.
The equilibrium price decreases but equilibrium quantity increases.
The results also suggest that margin is a direct factor which determines the equilibrium price of stock index futures.
An efficient market should be capable of continuously taking in new information that affects market outlook and of moving quickly and smoothly to the new equilibrium price level.
Why not, he thought, try and see what types of auction would let traders converge most quickly towards an equilibrium price?
