Supply and Demand

The video explains the concepts of supply and demand and how they affect market prices. Demand is the quantity of a product that consumers are willing and able to purchase at a given price and over a given time period. The law of demand states that as price rises, quantity demanded will fall. Factors affecting demand include consumers’ income, the price of other products, and consumer preferences. Any factor that causes demand to increase shifts the demand curve to the right, and any factor that causes demand to decrease shifts the curve to the left. Supply, on the other hand, is the quantity of a product that producers are willing and able to provide or produce at a given market price and over a given time period. The law of supply states that as price increases, suppliers are incentivized to increase their quantity supplied. Factors affecting supply include production costs and technology, government policies, and natural disasters. The video emphasizes the importance of understanding the difference between a change in price and a change in any of the other factors affecting demand or supply, as they have different impacts on the demand or supply curve.