2.1 - Law of Supply and Demand

The Global Supply

- The global pandemic changed the pattern of global supply chains

Market

- Where buyers and sellers meet to exchange goods and services

Law of Demand

- Price increases, quantity demand decreases

- Price decreases, quantity demand increases

Ceteris Paribus

- keeping factors constant (at a ceteris paribus) , buyers will purchase more at lower prices and less at higher prices

Quantity Demanded

- Number of units that a buyer is willing to purchase at any given price

Demand

- Set of all quantities demanded at different price levels

Law of Supply

- Driven by profits, suppliers will sell more

- Price increases, supply increases

- Price decreases, supply decreases

Quantity Supplied

- Number of units that a seller is willing to produce at any given price

Supply

- set of all quantities supplied at different price levels