Demand and supply is an economic system and fundamental concepts for economics who as determined the price of market. It was conclusion, the unit price level of a good essentially was determined by the point who demands and supply was intercept in a same level and same point. The price system only working in a market economy if they’re having a free choice with the market.
Demand is represent how many about the quantity of a goods is what the customers wanted. Its refer to about the ability to pay and wanted to buy by the buys. Sometimes demand also calling to another name that is effective demand. Demand can be shows by the demand schedule which is showing the maximum of quantity demanded (wanted and needed to buying) at all prices.
The law of demand is represent about the all factors, if the prices is higher, than people want to buying will be less and low. The demand is represent a downward slope. This can be explain in others, when the price higher, the lower quantity demanded. Or in an opposite side, when lower price, higher quantity demand. Demand can be explaining by using demand schedule and demand curve. The relationship between the quantity and price demand is calling demand relationship.
Here, showing about the demand curve or called also simple demand curve:
According to the graft, we can see point A; B and C are the point on the simple demand curve. Each point is reflecting a related point between the price (P) and quantity demand (Q). So, at the point A, the price at P1 and quantity demand at Q1, other also is the same. According the demand curve, they representing a downward curve and negative demand relationship. The higher of the price, then the lower of the quantity demand. On opposite side, the lower of the price, the higher of the quantity demand.
Supply is representing about the both of the ability to selling or produce and the willingness to selling by the producers. Sometimes supply also call by effective supply. Supply can showing by using supply schedule which is showing maximum of quantity supply of all prices. Time is most important factors to affecting the condition of supply.
The law of supply is showing about the quantity that will be selling out at a certain price. But it’s not same like the law of demand; supply is representing an upward slope. This is meaning if the higher the price, then quantity also supply higher. Supply can be explaining by using supply schedule and supply curve. The relationship between the price and how much of a goods is supply is calling supply relationship.
Here, showing about the supply curve or called also simple supply curve:
According to the graft, we can see point A; B and C are the point on the simple supply curve. Each point is reflecting a related point between the price (P) and quantity supply (Q). So, at the point A, the price at P1 and quantity supplied at Q1, and the other also is the same. According the demand curve, they representing an upward curve and positive demand relationship. The higher of the price, also higher of the quantity demand.
Equilibrium is showing when the demand and supply curve are intercept at a same point that equaling. At this point, at the point intercept, the allocation of goods is at its most efficient because the amount to product having supplied is the same as the amount of goods having demanded. Thus, this means buyer (quantity) and the seller (price) agree for the both of quantity and price.
Here, we can see the equilibrium curve when the demand and supply relationship are intercept together:
According to the equilibrium curve, equilibrium are occurs when the demand and supply curve are intercept in an intersection point. At this point, the quantity is Q* and price is P*. This figure are representing to an equilibrium price and quantity. Market equilibrium, refer to the condition when the...
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