Finance Library
EconomicsBeginner 4 min read

Supply and Demand

The single chart that explains almost every price you see.

Where the supply and demand curves cross sets the market price.

The two curves

Demand slopes down: as prices fall, more people want to buy. Supply slopes up: as prices rise, sellers are willing to produce more.

Equilibrium

Where the curves cross is the market price — the only price where the amount buyers want equals the amount sellers will produce.

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