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Economics (Boundless)
3: Introducing Supply and Demand

3: Introducing Supply and Demand

Last updated

Jan 4, 2021
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- 2.1: Introducing the Market System
- 3.1: Demand

Boundless
Boundless

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3.1: Demand
In general, the law of demand states that the quantity demanded and the price of a good or service is inversely related, other things remaining constant.
3.2: Supply
The law of supply states that there is a positive relationship between the quantity that suppliers are willing to sell and the price level.
3.3: Market Equilibrium
When a market achieves perfect equilibrium there is no excess supply or demand, which theoretically results in a market clearing.
3.4: Government Intervention and Disequilibrium
Governments intervene in markets when they inefficiently allocate resources.

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