Supply and demand work together to create balance in the economy. This balance is called market equilibrium.
Law of Demand: When prices go down, lots of people want to buy more. For example, if ice cream prices fall, more people will want to buy it.
Law of Supply: On the flip side, when prices go up, producers want to make and sell more. So, if ice cream prices increase, they will produce more ice cream.
When the amount of ice cream people want to buy matches the amount producers want to sell, we reach equilibrium. This helps make sure resources are used efficiently!
Supply and demand work together to create balance in the economy. This balance is called market equilibrium.
Law of Demand: When prices go down, lots of people want to buy more. For example, if ice cream prices fall, more people will want to buy it.
Law of Supply: On the flip side, when prices go up, producers want to make and sell more. So, if ice cream prices increase, they will produce more ice cream.
When the amount of ice cream people want to buy matches the amount producers want to sell, we reach equilibrium. This helps make sure resources are used efficiently!