Supply and Demand are two most important forces that make market economies work. They determine the quantity of produced goods and their selling price.
Quantity demanded is the amount of good buyers are able to purchase, whereas amount of good that sellers are able to sell known as Quantity supplied.
Law of supply is completely opposite of Law of demand. Taking other factors equal,the quantity supplied of a good rises with the rising price of good according to law of supply but quantity demanded of a good falls with falling price according to law of demand.
Demand schedule and supply schedule are the tabular format show the relationship between price of good and the quantity demanded and relationship between price of good and quantity supplied, respectively.
In the same way Demand curve represents the relationship between price of good and quantity demanded graphically whether Supply curve is the graphical representation of relationship between price of good and quantity supplied. Supply curve is always upward whereas Demand curve is always downward except some special cases.
Variables of these two forces are represented as-
Supply- S:Qx=f(P,Prg,Pj,R,Ap,Ep,S)
Demand-D:Qx=f(P,T,I,Ps,Pc,EC,A,Po)
A situation in which market price reaches the level at which quantity supplied equals quantity demanded, known as Equilibrium.
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