Why do only relative prices matter in general equilibrium?

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asked May 19, 2024 147k views

1 Answer

Mariomc · Answer 1 · 2024-05-24T20:22:11+0000

Step-by-step explanation:

The more the relative price the more demand, the less relative price the less demand, in general equilibrium we can take a good and set its price to 1.

Why do only relative prices matter in general equilibrium?

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