demand curve and supply curve difference
Answers
Answer:
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Answer:
The difference between demand curve and supply curve are
Explanation:
(a) Demand Curve
Definition: Demand can be defined as the desire or the willingness of the buyer along with his/her ability or capacity to pay for the service or commodity at specific price.
The Law: The law of demand says that, if all other factors remain equal higher the price of a product or goods, the lesser the people will demand that product or goods.
Graph Curve: The curve for demand would be downward sloping and the reason being the quantity and price have an opposite relationship.
Variations Effects: Demand increases with the supply being the same will lead to a shortage situation and when demand decreases with the supply being the same will lead to a surplus situation.
Representation: Demand should be viewed from a consumer or buyer perspective.
Price Impact: As the price of the product increases, the demand for the product decreases thus indicating an inverse relationship.
Time Factor: There is no impact on the time factor on the demand relationship.
(b) Supply Curve
Definition: Supply can be defined as the quantity of a commodity that is made available to the buyers or consumers by the producers at certain or specific price.
The Law: The law of supply states that the higher the price of goods, the higher the quantity will be supplied. Producers are ready to supply more at a higher price and the reason for the same being selling a higher quantity at a higher price will increase their revenue.
Graph Curve: Since price and quantity move in the same direction, the graph curve for supply will be upward sloping.
Variations Effects: Supply increases with the demand being the same will lead to a surplus situation and when supply decreases with the demand being the same will lead to shortage scenario.
Representation: Supply can be viewed from the producer perspective.
Price Impact: As the price of the product increases, the supply of the product will also increase, thus indicating a direct relationship.
Time Factor: The supply relationship is a factor of time as time is key to supply because the suppliers must react rapidly to a change in price or demand. So, it is very important to try and determine whether the change in price which is caused by the demand will be permanent or temporary.