Question

explain the terms demand and supply with an example of our daily life

Answer 1

When supply of a product goes up, the price of a product goes down and demand for the product can rise because it costs loss. At some point, too much of a demand for the product will cause the supply to diminish. As a result, prices will rise. The product will then become too expensive, demand will go down at that price and the price will fall. Supply and demand should reach an equilibrium. The amount of goods being supplied is the same as the amount demanded and resources are allocated efficiently.