It may seem obvious that in any sale transactionthe price satisfies both the buyer and the seller, matching supply with demand. The interactions between supply, demand, a… See more

The law of demand holds that demand for a product changes inversely to its price, all else being equal. In other words, the higher the price, the lower the level of demand. Because b… See more

The law of supply relates price changes for a product with the quantity supplied. In contrast with the law of demand the law of supply relationship is direct, not inverse. The higher … See more

Also called a market-clearing price, the equilibrium price is the price at which demand matches supply, producing a market equilibrium acceptable to buyers and sellers… See more

In industries where suppliers are not willing to lose money, supply will tend to decline toward zero at product prices below production costs. Price elasticity will also depend on … See more