Supply and Demand, Market Equilibrium and Price Elasticity
There are a number of factors that can affect the levels of supply and demand, which are closely related. Price is one of the main things that affects supply. If the price of something is higher, there will be less of a supply as it will cost more to obtain it. There will also eventually be less of a demand for the product, as people who are purchasing the item will be less willing to buy it if the cost is high. Although there may be other factors that affect supply and demand, price is one of the most apparent. It is price that affects supply and demand most of all.
Market price is the price that is set when supply and demand interact. Market equilibrium, which is also known as equilibrium price, is the price that is the result of the...
[ View Full Essay]