Question

Who does the demand side of the market represent? Who does the supply side of the market represent? How does movement in the demand curve and the supply curve affect market equilibrium? Your response to the last question should reference the shifts in the supply and demand curves and changes in the equilibrium price and equilibrium quantity.

Answer 1

The demand side of the market: The demand side for the market represents the consumer demand or the consumer need for goods and services are the given price. IF the price is higher the demand will be low and if the price is lower the demand will be higher.

The supply side of the market: The supply side for the market represents the producers are their willingness to sell their goods at a given price. IF the price is higher the supply will be higher and if the price is lower the supply will be lower.

The shift in the demand and supply curve: An increase in the demand will shift the demand curve to the right or at a higher price and higher output. IF the demand is low it will shift the demand curve to the left i.e. at a lower price and lower output.

A shift in the supply curve if right will decrease the price and increase the output and a shift to the left will increase the price and decrease the output. A shift in the supply curve is mainly because of change in productivity, technology input cost etc.