Market theories are frameworks that help explain how markets operate and how prices are determined. They analyze the behavior of buyers and sellers, focusing on supply and demand dynamics. Key theories include Classical Economics, which emphasizes free markets and competition, and Keynesian Economics, which highlights the role of government intervention in stabilizing the economy. Another important concept is Market Efficiency, which suggests that asset prices reflect all available information. This theory is often associated with the Efficient Market Hypothesis, proposing that it is impossible to consistently achieve higher returns than the overall market. Understanding these theories aids in making informed economic decisions.