ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The law of supply states that there is a direct relationship between price and quantity supplied. In other words, when the price increases the quantity supplied also increases. This is represented by an upward sloping line from left to right.

Detailed explanation-2: -Demand is generally considered to slope downward: at higher prices, consumers buy less. The point at which the two curves intersect represents the market-clearing price-the price at which demand and supply are the same. Prices can change for many reasons (technology, consumer preference, weather conditions).

Detailed explanation-3: -If a buyer expects the price of a good to go down in the future, they hold off buying it today, so the demand for that good today decreases. On the other hand, if a buyer expects the price to go up in the future, the demand for the good today increases.

Detailed explanation-4: -Producers expect the price of their product to rise in the future-If producers expect the price of their product to rise in the future, they will supply less in the present and wait for the price to rise. This will cause supply to decrease and shift to the left.