Supply and Demand, commodities

Supply and Demand

• Demand - the amount that consumers are willing and are able to buy at any given price.
• Supply - the amount sellers are willing to offer for sales of any given price.

Supply graph analysis

• The higher the price, the more a business will be happy  to supply
• As price rises the quantity supply increases.
• The supply line only goes upwards in a diagonal shape.

Demand graph analysis

• As price falls demand increases.
• Demand always go downwards in a diagonal shape.

Shortage  

• When there is demand for a product, which is greater than supply.
• When a surplus exists, prices will tend to fall.

Equilibrium point 

•  where the supply and demand for a product cross
• when a business is willing to buy…