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-
Supply
and
demand
are two words that you hear a lot in economics. They are also very important for understanding how markets work.
-
Supply
is how much of something
producers are willing to make and sell
. For example, how many pizzas a pizza shop can make and sell in a day.
-
Demand
is how much of something
consumers are willing to buy.
For example, how many pizzas people want to eat in a day.
- Supply and demand depend on many things, such as the price of the product, the price of other products, the income and preferences of consumers , the technology and costs of production , and so on .
