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The factors that cause shifts in supply and the importance of demand are examined. What is the law of supply, and what are the factors that cause shifts in supply? What is the law of demand and why is it important? Why does an increase in the price of goods and services trigger a decrease in demand?

 

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Romarie Khazandra Marijuan
Romarie Khazandra MarijuanLv10
28 Sep 2019

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The law of supply and demand asserts that

a. demand curves and supply curves tend to shift to the right as time goes by.

b. the price of a good will eventually rise in response to excess demand for that good.

c. when the supply curve for good shifts, the demand curve for that good shifts in response.

d. the equilibrium price of a good will be rising more often than it will be falling.

 

The law of supply and demand asserts that:
 
(i) demand curves and supply curves tend to shift to the right as time goes by.
(ii)  the price of a good will eventually rise in response to excess demand for that good.
(iii) when the supply curve for a good shifts, the demand curve for that good shifts in response.
(iv) the equilibrium price of a good will be rising more often than it will be falling.

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