Supply And Demand: Free-Enterprise System

Supply and demand are extremely essential parts of the US economy and other free-enterprise systems. Interaction between the two determine the price, quantity, and distribution of products in the market. Supply refers to the amount of products businesses are able to sell at different prices at certain times, while demand refers to the amount of products consumers want to buy at different prices at certain times. If a certain product is in high demand, producers will produce a larger quantity of the product and will raise prices as high as they can until consumers are no longer willing to buy the product. Consumers are usually more willing to purchase more of a product at a lower price, and businesses are more willing to provide more of a product