Relationship between DEMAND and SUPPLY Explained

#demandandsupply #demand #supply #marketanalysis
What happens when Demand is higher than Supply?
What happens when Supply is higher than Demand?
What is a consequence of demand higher than supply in a market ⬇️
Price Increases: When demand exceeds supply, sellers may respond by raising prices to capitalize on the scarcity of the product.
As a result, consumers may end up paying higher prices for the limited quantity available.
What is a consequence of supply higher than demand in a market ⬇️
Price Decrease: To clear the surplus and encourage more sales, sellers often reduce prices to attract buyers. Lower prices can stimulate demand and help to reduce the surplus by encouraging consumers to purchase more of the excess supply.
But this may lead to loss of Revenue for Sellers: Lower prices resulting from surplus conditions can lead to decreased revenue for sellers. As they reduce prices to move excess inventory, they may not be able to generate as much revenue per unit sold.