This document discusses the fundamental economic concepts of supply and demand. It explains that demand refers to how much of a product is wanted by consumers and that supply is how much is produced. The price of a good or service is determined by the point at which the quantity demanded equals the quantity supplied. The law of demand states that as price increases, demand decreases, resulting in a downward sloping demand curve. Conversely, the law of supply shows that as price increases, supply increases too, depicted by an upward sloping supply curve.

1. DEMAND AND SUPPLY LAW
8th Graders
UNIDAD EDUCATIVA “LEMAS”

2. DEMAND AND SUPPLY LAW
 Supply and demand in a market economy is one
the most fundamental concepts in economics.

3. DEMAND AND SUPPLY LAW
 Demand refers to the quantity of a product or
service that is demanded by consumers.

4. DEMAND AND SUPPLY LAW
 The price of a good or service is greatly influenced by
supply and demand and will usually settle at a point
where the quantity demanded by consumers will equal
the quantity supplied by producers.

5. DEMAND AND SUPPLY LAW

6. A. THE LAW OF DEMAND

The law of demand states that, if all other factors
remain equal, the higher the price of a good, the less
people will demand that good. In other words, the
higher the price, the lower the quantity demanded.
The amount of a good that buyers purchase at a
higher price is less because as the price of a good goes
up, so does the opportunity cost of buying that good.
As a result, people will naturally avoid buying a
product that will force them to forgo the consumption
of something else they value more. The chart below
shows that the curve is a downward slope.

7. THE LAW OF DEMAND CURVE

8. B. THE LAW OF SUPPLY
 Like the law of demand, the law of supply
demonstrates the quantities that will be sold at a
certain price. But unlike the law of demand, the
supply relationship shows an upward slope. This
means that the higher the price, the higher the
quantity supplied. Producers supply more at a
higher price because selling a higher quantity at
a higher price increases revenue.

9. THE LAW OF SUPPLY CURVE

10. THE LAW OF SUPPLY CURVE