Answer to Question #294282 in Economics for Owen

Question

Given the principle of demand and supply ceteris paribus, what it it's basic implication on the prices of commodities?

Answer 1

The law of demand says that at higher prices, buyers will demand less of an economic good. The law of supply says that at higher prices, sellers will supply more of an economic good. These two laws interact to determine the actual market prices and volume of goods that are traded on a market.