Law of Supply And Demand
Jump to navigation
Jump to search
A Law of Supply And Demand is an economic principle that states that the price of a good or service in a market is determined by the balance between its availability (supply) and the level of desire or need for it (demand).
- AKA: Supply And Demand.
- Example(s):
- an increase in prices during shortages,
- an decrease in prices during oversupply,
- ...
- Counter-Example(s):
- See: Market Equilibrium, Elasticity of Demand, Price Ceiling, Price Floor, Demand, Microeconomics, Economic Model, Price Determination, Market (Economics), Perfect Competition, Unit Price, Good (Economics), Economic Equilibrium, Output (Economics), Supply (Economics).
References
2023
- (Wikipedia, 2023) ⇒ https://en.wikipedia.org/wiki/Supply_and_demand Retrieved:2023-8-6.
- In microeconomics, supply and demand is an economic model of price determination in a market. It postulates that, holding all else equal, in a competitive market, the unit price for a particular good, or other traded item such as labor or liquid financial assets, will vary until it settles at a point where the quantity demanded (at the current price) will equal the quantity supplied (at the current price), resulting in an economic equilibrium for price and quantity transacted. The concept of supply and demand forms the theoretical basis of modern economics.
In macroeconomics, as well, the aggregate demand-aggregate supply model has been used to depict how the quantity of total output and the aggregate price level may be determined in equilibrium.
- In microeconomics, supply and demand is an economic model of price determination in a market. It postulates that, holding all else equal, in a competitive market, the unit price for a particular good, or other traded item such as labor or liquid financial assets, will vary until it settles at a point where the quantity demanded (at the current price) will equal the quantity supplied (at the current price), resulting in an economic equilibrium for price and quantity transacted. The concept of supply and demand forms the theoretical basis of modern economics.