Question

Briefly explain how demand and supply are determined in a market.

Answer 1

The relation between consumers of a resource and it sellers is explained using supply and demand for it. Market price have a significant role in supply and demand variations. In market, supply is the quantity of available goods and demand is the needed quantity of goods for buyers. Price of goods goes on diminish as supply rises. Along with this demand may rise as the price decreases. On other hand supply will greatly decrease as demand rises. The market price of most of the products and services is influenced by demand and supply together. Rise in demand than supply leads to increase in price. And vice versa. The productive capacity, regulations or taxes imposed on products, sellers are all the determines supply. Demand is influenced by buyers likes and interests. Certain product have demands in certain period. Alternative product cost also influence product prices. Demand also varies with variation in income of individual at specific times.