Supply and demand

Running Head : SUPPLY AND DEMAND

Supply and Demand Supply and Demand

Supply is the quantity of goods or services that a producer wants to sell at a certain price in a certain period time . It is the amount of goods and services that the producer supplies and issues to the market to be sold to the customers . The amount of these goods and services that are accepted in the market and are bought by the customers at that particular price in a given period of time is known as the demand . When

br these two functions are the same , the market is in equilibrium when the supply is higher than the demand , there is a surplus and when the demand is higher than the supply , there is a shortage

Demand is the overall demand of the market meaning that is the addition of all quantity demanded which is per unit price . Quantity demanded is affected directly by the price of the products and the income level of the customer . It is natural that if the price is low , the customer would be more willing to buy the good or service as that would save up more of his income and maintain his purchasing power . If the product is expensive , then the customer will think about the finishing off of his income and think a number of times without buying thus , reducing the chances of actually purchasing the good and service . Such shifts in quantity demanded are along the demand curve which...