Supply and Demand
The way prices change based on how much people want something and how much of it is available. đ
Introduction BrĂšve
Supply and demand is like a dance between sellers and buyers that determines prices in the market. đđș When lots of people want something (high demand) but there isn't much of it available (low supply), prices go up. It's similar to how concert tickets become expensive when everyone wants to see a popular artist but there are few seats available.
Explication Principale
The Law of Demand đ
It's like shopping during a sale - when prices go down, people want to buy more. When prices go up, people usually buy less. If ice cream costs $10, you might buy one. If it costs $2, you might buy three!
The Law of Supply đ
It's like being a lemonade seller - when prices are higher, you're motivated to make more lemonade to sell. When prices are low, you might not bother making as much since you won't earn much.
Price Equilibrium âïž
It's like finding the perfect temperature where everyone's comfortable. The price settles at a point where the amount sellers want to sell matches the amount buyers want to buy.
Market Changes đ
It's like weather affecting an umbrella shop - when it rains, more people want umbrellas (demand increases), and prices might go up. If many new umbrella shops open (supply increases), prices might go down.
Exemples
- Imagine a hot summer day at the beach - ice cream vendors can charge higher prices because many people want ice cream (high demand) and there are few sellers (limited supply). đïžđŠ
- Think about video game consoles at launch - when a new PlayStation comes out, many people want one (high demand) but stores have few units (low supply), so prices stay high. đź
- Consider Valentine's Day flowers - prices go up because many people want to buy roses (high demand) on the same day, even though flower shops try to stock more (increased supply). đ
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