GENERAL KNOWLEDGE

Detailed explanation-1: -Economists call this positive relationship between price and quantity supplied-that a higher price leads to a higher quantity supplied and a lower price leads to a lower quantity supplied-the law of supply. The law of supply assumes that all other variables that affect supply are held constant.

Detailed explanation-2: -The Law of Demand states that there is an indirect relationship between the price of a good or service and the quantity of that good or service that consumers are willing and able to buy. In other words, as the price of an item increases, buyers are less willing and able to buy it and vice versa.

Detailed explanation-3: -Economists generally lump together the quantities suppliers are willing to produce at each price into an equation called the supply curve. The higher the price, the more suppliers are likely to produce. Conversely, buyers tend to purchase more of a product the lower its price.