Supply And Demand Terms Of The Microeconomics

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Supply and demand terms are included in the Microeconomics. Both can be shown using diagrams and they also can be affected by some specific determinants. The equilibrium price comes from supply and demand curves and it depends on the movement of each. All the above can be affected by the Governments decisions such as changes at the minimum wage. First and foremost the amount of a product that a consumer is willing to buy depends on its price. The more expensive the product is, the less is the amount that the consumer is able and willing to pay for it. That is demand. In this way the demand curve show the willingness to buy according to the prices. The price and the quantity are inversely, this means that if the one gets high then the other will decrease and reversely. The Demand curve But the price is not the only determinant that can cause changes .There are also some other determinants that can affect the Demand curve such as : • The substitute goods. In more detail if the price increase in a product then the consumers will prefer to buy its substitute and its demand will increase. For example if the price of pork raises the demand for lamp will rose. • The complementary goods. There are some good that usually comes together such as coffee and sugar. As a result, if people reduce the demand for coffee then the demand for sugar will also decrease. Supply is the amount of goods or services that suppliers are
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