ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The law of supply says that a higher price will induce producers to supply a higher quantity to the market. Because businesses seek to increase revenue, when they expect to receive a higher price for something, they will produce more of it.

Detailed explanation-2: -The Law of Demand. The law of demand says that rising prices reduce demand. So as prices rise, customers buy less.

Detailed explanation-3: -The law of demand holds that the demand level for a product or a resource will decline as its price rises, and rise as the price drops. Conversely, the law of supply says higher prices boost supply of an economic good while lower ones tend to diminish it.

Detailed explanation-4: -The law of supply states that a higher price leads to a higher quantity supplied and that a lower price leads to a lower quantity supplied. Supply curves and supply schedules are tools used to summarize the relationship between supply and price.

Detailed explanation-5: -According to basic economic theory, the supply of a good will increase when its price rises. Conversely, the supply of a good will decrease when its price decreases. There’s also price elasticity of demand. This measures how responsive the quantity demanded is affected by a price change.