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“Extremely creative, extremely elegant ... Percolation starts with a graph, which is a collection of vertices (points) that can be connected by edges (lines). One of the simplest examples is a square ...
Notice that the graph includes three different curves, each of which represent the profit/loss possibilities at three different points in time. The dotted line is the profit/loss today ...
At this point, the corresponding price is the equilibrium market price, and the corresponding quantity is the equilibrium quantity exchanged in the market. It can be useful to graph a demand and ...
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