Final answer:
Markets explained on the basis of supply and demand can vary depending on the number of buyers and sellers, the presence of market power, and the level of competition.
Step-by-step explanation:
In markets, prices play a significant role in conveying information between buyers and sellers. They reflect the relationship between supply and demand. Markets with many buyers and many sellers of a standardized product can be explained on the basis of supply and demand. These markets are characterized by competition and the interaction of multiple buyers and sellers, leading to price determination through supply and demand.
On the other hand, markets with market power, where there are fewer buyers and sellers, may involve bargaining between buyers and sellers to determine prices. This is more characteristic of monopolistic or oligopolistic markets where a single seller or a small group of sellers have significant control over prices.
In real-world economies, markets vary in terms of the number of buyers and sellers and the level of market power. While there may be instances of markets where a single seller determines the price, this is more of an exception rather than the norm.