IDNLearn.com is your go-to resource for finding expert answers and community support. Ask anything and receive immediate, well-informed answers from our dedicated community of experts.
Sagot :
Yes, supply and demand affects the changes of prices in a price-setting
system because of law of supply and demand.
The law of supply and demand is an economic theory which explains that how supply and demand are related to each other. It's a fundamental economic principle that when the supply exceeds demand the prices will fall. When demand exceeds supply, prices rise.
If there is an increase in supply for goods and services while demand remains the same, prices always fall to a lower equilibrium price and a higher equilibrium quantity of goods and services.
If there is a decrease in supply of goods and services while demand remains the same, prices tend to rise and a lower quantity of goods and services.
The same inverse relationship is applicable for the demand for goods and services. However, when the demand increases and supply remains the same, the higher demand will lead to a higher equilibrium price and vice versa.
To know more about law of supply and demand here:
https://brainly.com/question/4596280
#SPJ4
Thank you for participating in our discussion. We value every contribution. Keep sharing knowledge and helping others find the answers they need. Let's create a dynamic and informative learning environment together. Find reliable answers at IDNLearn.com. Thanks for stopping by, and come back for more trustworthy solutions.
