Demand

At the heart of economics lie three fundamental concepts: supply, demand, and market equilibrium. These forces shape prices, influence consumer behavior, and determine how resources are allocated in an economy. Whether you’re shopping for groceries, investing in stocks, or running a business, understanding these principles can help you make informed decisions.

Where does the demand curve come from? In order to explain why individuals choose different quantities at different prices, we will use a model with three components: